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HMRC internal manual

Decisions and appeals for National Insurance Contributions and Statutory Payments

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Decision types: Whether failure to pay Class 2 National Insurance contributions was due to ignorance or error

Regulations 65(2) and 155A(2)(j) of the Social Security (Contributions) Regulations 2001 (SI 2001 No 1004)

Regulation 155A(2)(j) of the Social Security (Contributions) Regulations 2001 (the Regulations) provides for HMRC officers to decide whether in the case of a Class 2 contribution remaining unpaid by the due date

  • the reason for the non-payment is the contributor’s ignorance or error, and,
  • if so, whether that ignorance or error was due to his failure to exercise due care and diligence.

NIM23007 explains that higher rates do not apply and Class 2 National Insurance contributions (NIC) are payable at their original rate if the two tests set out in the regulation are both satisfied. If a person pays Class 2 NIC after the due date, and after certain time limits, the NIC either don’t count for benefits immediately or don’t count at all. See NIM23001 for more information about time limits.

For guidance about the wording of such a decision see DANSP39500.