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HMRC internal manual

National Insurance Manual

Special Cases: Married Women: 2 Year Test

Regulation 128(1)(c), SS(C)R 2001

Regulations provide that a married woman loses her right to reduced liability if thereis a period of two consecutive tax years after 5 April 1978 in which she:

  • has no earnings on which Class 1 contributions are payable or are treated as paid (see NIM01007); or
  • has not been self-employed

This is known as the ‘two year test’.

If a woman apparently loses her right to reduced rate liability because of the two year test but it is later found that:

  • Class 1 contributions should have been paid or treated as paid for any part of the two year period; or
  • she was self-employed during that period,

her reduced rate election is still valid. The fact that contributions were not paid or were paid late does not matter.