How to work out the deemed payment: Step Eight - example
This example is also reproduced at ESM3172using a step by step guide.
Ms G is a worker whose service company has earned income from a relevant engagement. The service company paid her a salary of £3,000 during the year. The amount at Step Seven is £30,000. This produces the following figures:
|x||=||Earnings to date||3,000|
|y||=||The amount at Step Seven||30,000|
|a||=||The secondary Class 1 NICs threshold||4,385|
|b||=||The secondary Class 1 NICs percentage rate||12.2%|
Using the formula:
the deemed payment is equal to
The secondary Class 1 NICs payable in respect of the deemed payment are £3,112.