Thank you for your feedback.

Was this useful?

Class 1 NIC and Class 4 NIC

Article ID
ias-12277
Article Name
Class 1 NIC and Class 4 NIC
Created Date
3rd June 2016
Product
IRIS Personal Tax
Problem
The deferment of Class 4 NIC has been removed from 2016 onwards. There are two new boxes within the Employment -Earnings screen in relation to National Insurance Contributions and clients require to know what these are for.
Resolution
The two boxes in question are to be filled in if your clients have employment and are also self-employed. They are to be filled in as follows:- 1. Earnings from PT to UAP – These are earnings that appear in the column from PT to UAP on the P60 2. Earnings from UAP to UEL – These are earnings that appear in the column from UAP to UEL on the P60 3. These figures are then added together and multiplied by 12%. 4. Then the Class 2 NIC figure is entered under Trade, Profession or Vocation | NIC Adjustments 5. The result from step 3 is then added to the Class 2 NIC figure and this figure is then looked at in regards to the restriction of Class 4 NIC if appropriate. Therefore depending upon the level of a contributor’s profits and the amount of Class 1 and Class 2 NICs paid, the maximum amount of Class 4 NICs due will vary. For more information please see the Tax Calculation Summary Notes that can be found on the HMRC web site and it would be page TCSN 33 that will provide more information.

Thank you for your feedback.

Was this useful?