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HMRC internal manual

Decisions and appeals for National Insurance Contributions and Statutory Payments

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Decision types: Whether National Insurance contributions have been paid in error

Regulation 155A(3)(a) of the Social Security (Contributions) Regulations 2001

Regulation 155A(3)(a) of the Social Security (Contributions) Regulations 2001 (the Regulations) provides for HMRC officers to decide whether a contribution (other than a Class 4 contribution) has been paid in error, as mentioned in regulation 52(1) of the regulations, see NIM37000. If National Insurance contributions (NIC) have been paid in error, the person who has paid those NIC may apply for a refund.

Do not make decisions about whether NIC have been paid in error where decisions falling within section 8(1)(c) (NIC liability decisions) or section 8(1)(d) (entitled to pay decisions) should be made, see DANSP15600 and DANSP16500 respectively.

There will be occasions where the circumstances of the case mean that it is not appropriate to issue either a liability or entitled to pay decision with a paid decision, to show whether a refund is due or not. This will be the case where a person considers that they are entitled to a refund of Class 3 NIC because they paid the NIC in error. In these cases, issue a decision under regulation 155A(3)(a) of the Regulations.

Example

John Jones pays Class 3 contributions in respect of the 2003/04 tax year in July 2005, before the Pension Reforms were announced. This gives him 35 qualifying years for Basic State Pension (BSP), and he needs 44 to get a full BSP. After the Pensions Reforms are announced the person realises that he only needs 30 qualifying years. He requests a refund of the Class 3 contributions he paid in July 2005.

At the time that John paid the Class 3 contributions he was entitled to pay them.

Commentary on example

John wants a refund of NIC that were properly paid when he paid them. He is not questioning whether he was entitled to pay the NIC. Where a person pays Class 3 NIC they were entitled to pay, they can only be refunded if they were paid in error.

For guidance about the wording of such a decision see DANSP39900.