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HMRC internal manual

# Class 1 Structural Overview - post April 2003: Structural changes: The Class 1 and 2 maximum: Examples: Three Class 1 employments: Static earnings

## Example 2

D Dunn has three separate employments. His total earnings for the 2003/2004 tax yearare £72,000. He is paid the same monthly earnings in each job. His maximum Class 1liability is calculated as follows:

Step 1

Deduct the relevant Primary threshold from the relevant UEL and multiply that figure by53.

595 - 89 = 506 x 53 = 26818

Step 2

Multiply the result of step 1 by 11%

26818 x 11% = 2949.98

Step 3

Add together so much of the persons earnings from each employed earnersemployment as exceeded the Primary Threshold but did not exceed the Upper Earnings Limit.

2000 (monthly earnings) - 385 (monthly PT) = 1615 x 36 = 58140

Step 4

Deduct from the total found at step 3 step the amount produced by step 1

58140 - 26818 = 31322

Step 5

If the figure produced at step 4 is a positive figure multiply that figure by 1%

If the figure produced at step 4 is a negative figure, it is treated for the purposes ofstep 8 as nil

31322 x 1% = 313.22

### Step 6

Add together so much of the persons earnings from each employment asexceeded the Upper Earnings Limit.

There are no earnings over the UEL

Step 7

Multiply the result of step 6 by 1%

Not applicable

Step 8

Add together the results of steps 2, 5 and 7.

£2949.98 + 313.22 + nil = £3263.20

D Dunns maximum for the 2003/2004 tax year is £3263.20.