Class 1A National Insurance contributions: Special Class 1A NICs cases: Payments made by employers to earners in full-time education
Regulation 25 and 40(2)(ab) and paragraph 12 of Part 7 of Schedule 3 to the Social Security (Contributions) Regulations 2001
NIM02402 explains when payments made by employers to employees to support them while they are in full-time education at a university, college or school or other educational establishment, can be disregarded from earnings so that Class 1 NICs liability cannot arise. If the payments are disregarded from earnings for Class 1 NICs purposes, regulation 40(2)(ab) of the SS(C)R 2001 exempts such payments from Class 1A NICs liability. Therefore, there can be no Class 1A NICs liability.
EIM06205 explains the income tax position.