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HMRC internal manual

National Insurance Manual

NIM02120 - Class 1 NICs : Earnings of employees and office holders : Earnings paid in later year

Employers must enter payments made after the end of the tax year in which the employee earned them on the Deductions Working Sheet (DWS) in the tax week or month in which the employer paid them. NICs only become due when the earnings are paid (see NIM01002).

Examples of earnings paid in a later tax year include:

  • arrears of pay from a backdated pay increase
  • a director’s earnings paid in a tax year later than that in which the director earned them

See NIM08000 for general information regarding earnings periods.