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HMRC internal manual

National Insurance Manual

From
HM Revenue & Customs
Updated
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Special Cases: Married Women: Automatic cancelling of election following failure of ‘2 Year Test’

A reduced liability election is cancelled by the National Insurance Recording System 2(NIRS2) if:

  • contributions are received two complete tax years or more after the last reduced rate NICs were recorded. In this circumstance. The NIRS record is noted ‘LAPSED BY POSTING’ after the date the election ends.
  • NICO Class 1 Caseworker inputs data to this effect. The record is noted ‘LAPSED BY LO 1717’
  • a Retirement Pension calculation is needed, by request or automatically, and there are two complete tax years or more when contributions have not been received. The record is noted ‘LAPSED FOR RP’; or
  • credits are posted 2 complete tax years or more after the last reduced rate contributions. The record is noted ‘LAPSED BY CREDITS’.