Chapter NIM23650

Published date11 April 2016
Record NumberNIM23650
Regulation 1(2) and 4 of the Social Security (Crediting and Treatment of Contributions, etc.) Regulations 2001 (SI 2001 No 769)

There are time limits within which voluntary Class 2 National Insurance contributions (NICs) must be paid to count for contributory benefits, see NIM23001.

Although a person does not have to pay Class 2 NICs if they are not liable to do so, if they pay them more than 42 days after the end of the tax year in respect of which they are paid, they will for the purposes of entitlement to any contributory benefit, be treated as paid on the date payment is made. So, if a persons’ entitlement to a contributory benefit would be enhanced by NICs paid after the 42 days described previously, they will only enhance that benefit from the date the NICs were paid. The 42n d day after the end of a tax year is 17 May. A person who pays Class 2 NICs they are not liable to but are entitled to pay, in response to quarterly bills, payment requests or by DD, may pay some of the NICs after the 17 May. This potentially could have an adverse affect on entitlement to contributory benefits. See the example below which illustrates this point.

Example

Woman has Small Earnings Exception but asked for quarterly bills to be issued so she could consider paying Class 2 NICs voluntarily. She pays the Class 2 NICs due for the first three quarters of the year during the 2010/11 year. HMRC issue the last quarterly bill in April 2011.

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