Reporting Class 1A National Insurance contributions
Information about reporting Class 1A National Insurance contributions.
Employers are already required to operate PAYE on the income that a globally mobile worker earns. An employer can also apply to HMRC to only operate PAYE on the proportion of the employee’s income that is earned within the UK. This is a Globally Mobile Employee PAYE notification form, commonly known as s690.
The rules for operating PAYE on the income of globally mobile workers will remain the same as they are now. Find out more about notifying the proportion of income earnt in the UK. A number of stakeholders have asked whether s690 will interact with Class 1A National Insurance contribution liability when mandatory payrolling is introduced. We can confirm that as Class 1A is charged on taxable benefits it would not interact with s690.
We have also been asked whether Overseas Workday Relief (OWR) will be affected by the introduction of payrolling. There is no National Insurance contributions equivalent to OWR and so National Insurance contributions liability is unaffected.
Where the employee or director has no earnings but is provided with a BiK or expense, an employer will be required to send details of the benefits in kind (BIKs) and expenses provided using a Full Payment System (FPS), and to pay the Class 1A National Insurance contributions due. The FPS will need to show no payments of earnings and tax as none were provided.
More information about reporting and paying Class 1A National Insurance contributions when there are no earnings will be provided in future updates.
There is no interaction between Class 1A National Insurance contributions and the employee category letters. Class 1A will be reported by a different field in Real Time Information (RTI) and will have no bearing on the National Insurance contributions category letter used on earnings. We can confirm there are no other interactions between an employee’s category letter and the Class 1A rate or liability.