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HMRC internal manual

National Insurance Manual

HM Revenue & Customs
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Class 1A National Insurance contributions: Exemptions from Class 1A NICs: Benefits exempt from income tax: Earnings chargeable to income tax but no income tax due

Class 1A NICs are due on general earnings chargeable to income tax under ITEPA 2003 (before 6 April 2003 – does not apply to emoluments chargeable to income tax under Schedule E), even if the income tax is not payable. Chargeable does not mean the same as paid or payable. An example of this occurs where the conditions of a Double Taxation Agreement means that the UK gives credit for another country’s tax. For Class 1A NICs purposes it is the amount of the general earnings (before 6 April 2003 – emoluments) chargeable to income tax which attracts the liability, not the amount on which tax is actually paid.

For detailed information about Double Taxation Agreements you can find guidance in the Double Taxation Conventions Manual and the Double Taxation Relief Manual.