Class 1A NICs are paid by employers in respect of most benefits in kind provided to employees such as a company car. There is no employee contribution payable. If you provided taxable benefits to staff or directors your business is likely to have a Class 1A employers’ NIC liability. The deadline for paying class 1A NICs is 22 July 2022 if payment is made electronically (or 19 July 2022 if paying by cheque).
The deadline for submitting the 2021-22 forms P11D, P11D(b) and P9D is 6 July 2022. The forms can be submitted using commercial software or via HMRC’s PAYE online service. Making good payment by 6 July (for tax purposes) will also automatically remove or reduce the Class 1A NICs liability, as the payment will be made prior to the due date for paying Class 1A.
Class 1A NICs are due in respect of most benefits provided to:
- directors and certain other persons in controlling positions
- members of the family or households of the above.
Where a benefit is provided as part of salary sacrifice or other optional remuneration arrangement (OpRA), special rules apply and the Class 1A NICs are calculated as a percentage of the relevant amount.
Certain conditions must apply before Class 1A NICs are due. These conditions are that the:
- benefit must be from, or by reason of, an employee's employment and must be chargeable to Income Tax under ITEPA 2003 on an amount of general earnings as defined at Section 7(3) ITEPA 2003
- employment must be 'employed earner’s employment' under social security law and employment as a director or an employee
- benefit must not already attract a Class 1 NICs liability.