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HMRC internal manual

National Insurance Manual

HM Revenue & Customs
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Class 1 NICs: Earnings of employees and office holders: Horse racing - prize money

  • made directly or indirectly by the secondary contributor and the sum does not comprise or represent sums previously paid to the secondary contributor; or
  • directly or indirectly allocated by the secondary contributor to the earner.

For more guidance about when payments of gratuities can be disregarded from earnings when calculating Class 1 NICs liability see NIM02900.

More recently the Jockey Club has returned to its original role as a members club. The distribution of prize money to stables is now the responsibility of the British Horseracing Authority (BHA). Their rules are quite specific on the distribution of such monies and follow exactly the previous rules in being.

Effectively the stable employees decide the distribution criteria (BHA rule 119) and in line with ‘tronc’ arrangements, income tax but not NIC is accounted for by the Trainer on such distributions.