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HMRC internal manual

National Insurance Manual

Class 1 NICs: Earnings of employees and office holders: Training and similar costs: Return to Work Credit Scheme

Regulation 25 and paragraph 9 of Part VII of Schedule 3 to the Social Security(Contributions) Regulations 2001

The Return to Work Credit Scheme was introduced with effect from October 2003. Whenoriginally introduced the scheme did not apply to Northern Ireland.

The scheme was introduced to help people find and keep jobs and it is aimed at people whohave claimed incapacity benefit for 3 months or more.

Participants in the scheme are eligible for a return to work credit of £40 per week forup to 12 months.

Legislation was introduced with effect from 1 October 2003 to exclude from liability forNICs any payments made to a participant in the Return to Work Credit Scheme. Thelegislation is contained in paragraph 9 of Part VII of Schedule 3 to the Social Security(Contributions) Regulations 2001.

The scheme was extended to Northern Ireland with effect from October 2005. The disregardfor Return to Work payments was extended by amending paragraph 1 of Part VII of Schedule 3to remove paragraph 9 from the list of disregards not applicable to Northern Ireland. Theamending legislation was the Social Security (Contributions)(Amendment No.5) Regulations2005 [SI2005/2422].