Debt and return pursuit: miscellaneous charges: Regulation 80 determinations
When tax is determined against an employer and a decision is made in respect of the Class 1/1A NICs debt, Employer Compliance will:
- raise a Regulation 80 (R80) determination for tax
- make a Section 8 (S8) decision for any Class 1 or Class 1A NICs (or both) due from the employer at the same time.
Note: Where both Class 1 and Class 1A are in question, separate S8 decisions will be made to cover each class of NICs. Accounting records for any Class 1/1A NICs debt will be created on SAFE along with the tax as a Regulation 80 charge. In such circumstances, the Section 8 decision in respect of the NIC is a charge on the employer.
Employer Compliance will complete and issue form P380 detailing the charge, to the employer, together with a payslip prepared using function Print Payslip.
Class 1 and Class 1A National Insurance
If both Class 1 and Class 1A NICs are payable each will be recorded as separate amounts on the SAFE charge record.
Interest on tax and Class 1 NICs
Late-payment interest on the tax is charged under Regulation 82 Income Tax (Pay As You Earn) Regulations 2003.
Interest on employers’ Class 1 NICs is charged under paragraph 17 of Schedule 4 to the Social Security (Contributions) Regulations 2001.
The reckonable date for interest on both tax and Class 1 NICs is 19 April following the end of the tax year, for example 19/04/08 for year 2007-08.
Interest on Class 1A NICs
Interest on Class 1A is charged under Regulation 76 Social Security (Contributions) Regulations 2001. The reckonable date for interest on Class 1A is 19 July following the end of the tax year, for example 19/07/08 for year 2007-08.
Separate interest charges will be raised in respect of the tax and NICs elements that have been entered on the charge.
SAFE will automatically deal with interest calculations and raise late payment interest charges.
Interest will be dealt with automatically, but should you need to make a calculation use IRIS function SAIN01.
Allocation of part payment
Tax and Class 1 have different reckonable dates for interest from Class 1A NICs. In circumstances where all are due (or where Class 1 and Class 1A are due), it will be to the employer’s advantage to allocate part payments to tax and/or Class 1 NICs first, before allocating any remainder to Class 1A NICs. This rule should be followed unless the employer states that a part payment is specifically intended for the Class 1A NICs. SAFE will automatically allocate payment to the customer’s best advantage.
The Income Tax (Pay As You Earn) Regulations 2003
The determinations are made under the Income Tax (Pay As You Earn) Regulations 2003. Prior to 6 April 2004 determinations of Income Tax under Regulation 80 were determinations made under Regulation 49 of the Income Tax (Employments) Regulations 1993. New determinations will be made under Regulation 80, even if they relate to a period prior to 6 April 2004.
National Insurance decisions
Section 8 (S8) decisions made in respect of Class 1 and Class 1A National Insurance liability are made under National Insurance legislation (Section 8 of the Social Security Contributions (Transfer of Functions, etc) Act 1999 (“ToFA”).
Applications for payment
Employer Compliance will have issued a covering letter to the employer when issuing the determinations and/or decisions, including a payslip to make payment. The letter will confirm that interest is due on the tax and NICs but will not specify the precise amount of interest.
SAFE will make two applications for payment and then will automatically pass the charge to IDMS if it remains unpaid.
Discharges and Amendments
All discharges and amendments will be input directly on to SAFE.
Debt Technical Office action
Tax only - no associated NICs
R80 determinations after 5 April 2004
Work items will go to the DTO to review the debt on the C/W Miscellaneous list. These follow an automated process with any new debt subject to an automatic IDMS99 letter.
R49 determinations made before 6 April 2004
You should work these R49 cases on the “C/W Miscellaneous” list clerically.
Tax and NICs debt or NICs only debt
NICs debts will follow an automatic process in IDMS. The debt will be sent to the “Caseworker Miscellaneous” worklist.
If Class 1 or Class 1A NICs are included in the debt, you should firstly contact DTO Tyneside Protective Claims - (This content has been withheld because of exemptions in the Freedom of Information Act 2000) - to confirm if a protective claim is held for the NIC portion of the debt. If so, agree the next enforcement action.
Class 1 NICs will be shown on the Statement of Liability and the IDMS99.
For debts between £5,000 and £99,999, two automated letters are issued, with the second letter warning of enforcement. The case is then transferred to the DMTC for a phone call before it is allocated to the DCIT for review, before enforcement proceedings commence using Field Force or Summary Warrant.
For debts between £50 and £4,999, three automated letters are issued, with the third letter warning of enforcement, before being transferred to DCIT for review. If unresolved, these cases will subsequently be moved for referral to a Debt Collection Agency.
Manual enforcement letters can be issued as appropriate.
These tax and National Insurance debts can be enforced against the employer using all normal methods appropriate.
Further information on enforcement of National Insurance Contributions
Class 1 NIC at DMBM525110 and
Class 1A NICs at DMBM525310.
If the debt technical office is notified of insolvency, then ownership of any Regulation 80/S8 debts on IDMS should be transferred to ICHU in the normal way.
In Northern Ireland Insolvency cases should be referred to EIS Edinburgh (Belfast Team).