Class 1 Structural Overview - post April 2003: Structural changes: the Class 1 and 2 maximum: Example: Four Class 1 employments: Maximum not reached
H Harris has four part-time jobs. In each he earns £150 per week. His maximum Class 1NICs liability is calculated as follows:
Deduct the relevant Primary Threshold from the relevant UEL and multiply that figure by53.
595 - 89 = 506 x 53 = 26818
Multiply the result of step 1 by 11 per cent
26818 x 11% = 2949.98
Add together so much of the persons earnings from each employed earnersemployment as exceeded the Primary Threshold but did not exceed the Upper Earnings Limit.
150 (weekly earnings) - 89 (weekly PT) = 61 x 208 (weeks) = 12688
Deduct from the total found at step 3 the amount produced by step 1
12688 - 26818 = minus 14130
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 thepurposes of step 8 as nil
Add together so much of the persons earnings from each employment as exceeded theUpper Earnings Limit.
There are no earnings above the UEL
Multiply the result of step 6 by 1%
Add together the results of steps 2, 5 and 7.
£2949.98 + nil + nil
H Harris maximum for the 2003/2004 tax year is £2949.98.
The amount of primary Class 1 NICs the employee will pay in each employment on earnings of£150 will not reach the prescribed maximum but Mr Harris will have met his full Class 1liability.