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HMRC internal manual

Decisions and appeals for National Insurance Contributions and Statutory Payments

Decision types: National Insurance contributions liability decisions: Examples of disputes where National Insurance contributions liability decisions are needed

Section 8(1)(c) of the Social Security Contributions (Transfer of Functions, etc.) Act 1999; Article 7(1)(c) of the Social Security Contributions (Transfer of Functions, etc.) (Northern Ireland) Order 1999 (SR 1999 No 671)

HMRC Officers can decide whether a person is or was liable to pay contributions of any particular class and, if so, the amount of that liability, (liability decisions). For more information about such decisions see DANSP15700.

Some disputes can only be progressed by the issue of a decision, for example, where there is a difference of opinion between HMRC and an employer on an interpretation of words used in legislation and no agreement can be reached. The types of dispute that require a National Insurance contributions (NIC) liability decision include disputes

  • about whether a payment is earnings and should be included in gross pay when calculating Class 1 NIC, see NIM02000,
  • about whether a payment of earnings can be disregarded from earnings under any of the provisions within Schedule 3 of the Social Security (Contributions) Regulations 2001 (SI 2001 No 1004), see NIM02020,
  • about whether the intermediaries legislation applies to a worker, see ESM3000 for guidance,
  • about whether a person has paid NIC in error, see NIM37000 and DANSP16000,
  • about who is liable to pay Class 1 NIC when due, for example, the secondary contributor, the person who pays the earnings or the primary contributor, see NIM01015,
  • about whether it is not reasonably practicable for an employer to aggregate earnings where employees have more than one employment with the employer, see NIM10002
  • about whether different employers carry on business in association with each other when an employee works for more than one employer, see NIM10003,
  • about a person’s insurability, i.e. whether subject to UK social security legislation or another country’s legislation - see NIM27000CO about people coming to work in the UK from abroad or people from the UK going to work abroad,
  • about who is liable to pay Class 1A NIC when due, for example, the secondary contributor or the person who provides the benefit, see NIM13100,
  • about whether a person is liable to pay Class 2 NIC and the amount they are required to pay, see NIM20001,
  • about the application of higher rate provisions applied to Class 2 NIC. Where the liable person argues that non-payment was due to the contributor’s ignorance or error, you may need to consider whether a decision under regulation 155A (2)(j) is more appropriate (see DANSP24200 for more information).

For information about liability decisions for Class 4 NIC, see DANSP16100.