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HMRC internal manual

Employment Status Manual

From
HM Revenue & Customs
Updated
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Particular occupations: examiners - general

Tax

Most fees paid by examining bodies are chargeable to tax as employment income. In the majority of cases, tax is deducted from such fees under special arrangements negotiated centrally under Regulation 141 SI 2003 No. 2682. The PAYE Manual at PAYE70245 provides a list of the bodies covered by these special arrangements.

Other payments made by examining boards, which are chargeable to tax as employment income, are subject to PAYE in the normal way.

NICs

In accordance with Schedule 1, Regulation 2, Part II, Column (A)(6) of the Social Security (Categorisation of Earners) Regulations 1978 (SI 1978 No.1689), for NICs purposes, any person responsible for the conduct and administration of any examination leading to any certificate, diploma, degree, or professional qualification, whereby:

(a) they are engaged as an examiner, moderator or invigilator (or any similar capacity), or

(b) they are employed or engaged to set questions or tests for any such examination, and

(c) they are under contract where the whole of the work to be performed is to be done within less than twelve months,

will be liable to pay Class 2 NICs, and (if their profits exceed the lower profits limit), special Class 4 NICs.

Taxpayers should be advised to record the amount of the examiners’ fees received in the ‘additional information’ section of the SA return. HMRC should calculate the Class 4 NICs due and show the amount as ‘accepted’ in box 18.2B. On no account should a credit be shown in box 4 of the self-employment pages, as this could result in an overcharge of income tax.

However, the provisions at Schedule 1, Regulation 2, Part II, Column (A)(6) of the Social Security (Categorisation of Earners) Regulations 1978 (SI 1978 No.1689) will not apply if the provisions at Schedule 1, Regulation 2, Part 1 Column (A) 2 of the Social Security (Categorisation of Earners) Regulations 1978 (SI 1978 No.1689) are applicable and the provisions at Schedule 1, Regulation 2, Part I Column (B) 2(a) (b) or (c) of the Social Security (Categorisation of Earners) Regulations 1978 (SI 1978 No.1689) do not apply. This refers to arrangements involving a person who is providing their services to an end client under, or in consequence of, a contract between an Agency and the End Client.