National Insurance Flashcards
(8 cards)
What are Class 1 primary & secondary NICs payable on?
Cash earnings.
What constitutes cash earnings?
- Salaries, bonuses, vouchers and payments readily convertible into cash e.g. gold bars.
- Write-off on a beneficial loan.
- Employee personal bills paid by employer and phone rental and private calls where employee is subscriber (not mobile phone).
- SRMS payments more than 45p per mile, note there is no deduction if less than 45p per mile is received.
- Profit element of a round sum/general allowance
When SMRS is above HRMC rate, how is the difference computed for NICs specifically?
Business miles x (Employer rate - HRMC rate (45p))
In regards to Class 1B NICs, do we gross up the PAYE settlement agreement before applying the 13.8% flat rate?
Yes.
What is the employment allowance to reduce their Class 1 Secondary NICs?
£5,000.
When are Class 4 NICs due for payment?
- First payment on account - 31 January of the tax year.
- Second payment on account - 31 July of the tax year.
- Any balancing payment - 31 January following the tax year.
Is trading loss relief carried forward and subtracted from trading profits when calculating Class 4 NICs?
Yes, any trade loss reliefs that have been used in previous years are subtracted against current year’s trade profits then calculated NIC on.
Can you deduct trading losses from the previous tax year when calculating Class 4 NICs?
Yes.
