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Chapter DMBM525130

Document Cited in Related
Vincent
Published date29 April 2016
Record NumberDMBM525130

This section applies to Class 1 debts created by NICO following their end of year checks. These debts are in addition to the Class 1 National Insurance returned on the P35 and collected alongside PAYE.

NICO - How the debts arise

After the tax and NICs on the P35 Employer’s Annual Return have been captured by the processing office, P14 information is passed to NICO to check. NICO confirm that the correct amount of NICs have been paid and ensure that contributions are credited to the individual’s National Insurance account.

The NIRS 2 computer system carries out a number of checks on the P14s to confirm that the contributions paid are in ratio to the earnings recorded, and any failures are taken up for further investigation. These “Ratio Check Failure” cases may be genuine errors where figures have been entered incorrectly, or out of alignment, and most cases are usually resolved quickly.

However, the checks on the forms P14 may also reveal errors where National Insurance is underpaid.

Compatibility failures

These may be summarised as:

Married women cases

In the past, married women could elect to pay National Insurance at a reduced rate and were issued with a certificate to confirm this. Debts arise...

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