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HMRC internal manual

Debt Management and Banking Manual

Debt and return pursuit: NIC: Class 1A NICs: what are Class 1A NICs

What are Class 1A NICs

Class 1A National Insurance Contributions are due on most taxable benefits provided to employees, and are paid by employers only. They do not contribute to any benefit entitlement.

Identifying a Class 1A NICs liable employer

You can recognise a Class 1A liable employer by either the:

  • appropriate notation in the Information Codes box on the Work Item Details screen on IDMS
  • Class 1A NIC signal on BROCS in VTP Format 9.

BROCS accounts for payments of Class 1A and the issue of Class 1A returns.

Returns and payment

P11D(b) Return

Liable employers make a return of Class 1A on form P11D(b).

Regulation 80(1) of the Social Security (Contributions) Regulations 2001 provides that the return must be submitted no later than 6 July following the end of the year in which the liable benefits were provided.

Due date for payment

Regulation 71(1) of the Social Security (Contributions) Regulations 2001 provides that an employer who is liable to pay Class 1A NICs must do so by 19 July following the end of the year in which the liable benefits were provided.


BROCS will not differentiate between NICs underpayments arising from a P35 and those arising from a P11D(b), as Class 1A will form part of the overall underpayment of National Insurance.

If a P11D(b) is submitted on or after 19 July, and the P35 is logged but the P228 charge is not on record, BROCS will await this charge before referring any underpayment for local action, via IDMS.

However, if the employer is liable for making deductions in respect of student loans, the rules for clearing that liability as outlined in DMBM570080 apply.


As the Class 1A NICs liability is not legally due until 19 July, no Class 1A NICs charge postings will be forwarded to IDMS until after this date.

Although employers should be aware of the procedures for paying and accounting for Class 1A NICs, some may mistakenly include the amount with payment of their PAYE/NIC for month 3 of the current deduction year. Take this into account in any discussions with the employer about payment of Class 1A NICs.


Where the P35 is outstanding:

  • after 5 July it will be referred for local action
  • after 19 July BROCS will notify IDMS of the Class 1A NICs charge to update the IDMS work item.

These rules will be followed even if the Class 1A NICs liability has been paid before the P35 has been submitted, but staff should be aware that BROCS will treat the P11D(b) as a complete End of Year charge.

This will mean that an overpayment may be shown when in fact another return is expected and BROCS will refer any overpayments over £10.00 to the appropriate office to await disposal instructions, unless they have been referred directly to IDMS.

You should check that all returns have been submitted before taking any action in respect of an overpayment. BROCS will not automatically reallocate overpayments up to £249.99 to the current year.

Where the employer confirms part or all of the overpayment is Class 1A NICs you should arrange for the Class 1A signal to be set on BROCS using Function SNS. Setting the signal will result in the issue of form P11D(b) and payslip to the employer.

Cessation or insolvency cases

There is no formal requirement for Debt Management staff to pursue form P11D(b) where the employer is insolvent or in an cessation case.

But if you are aware that an employer who has ceased is Class 1A liable and you need to contact them about completion of forms P35/P14 you should also ask the employer to submit a completed form P11D(b).

If the employer does not submit the P11D(b), take no further action.


Interest on Class 1A NIC is charged under Regulation 76 Social Security (Contributions) Regulations 2001. Interest due on late payment of Class 1A is calculated from 19 July.