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Posted Thu, 03 Mar 2022 11:54:14 GMT by Tina
Our director have used Directors’ cumulative method for calculating National Insurance for previous years including 2021-2022. Can he change to Normal employee method for next year (2022-2023)? Many Thanks
Posted Mon, 07 Mar 2022 12:10:19 GMT by HMRC Admin 19
Hi,

A director can choose either the month by month method or the cumulative method.

When you are doing the final submission in the tax year your software will automatically recalculate the amount using the cumulative method as all directors pay National Insurance contributions using the cumulative method.

Thank you.
Posted Mon, 07 Mar 2022 16:01:26 GMT by Tina
Dear Sir or Madam, Thank you for your reply. According to the note of basic PAYE tools, it says that "Once you 're made your calculation choice, made your first payment to the director and submitted that information to HMRC you cannot change your choice" . Since this note says that it cannot change your choice once you submitted the information. Therefore, I would like to know whether my director can change to month to month method next year as we use cumulative method this year. Thanks
Posted Tue, 08 Mar 2022 09:54:42 GMT by HMRC Admin 10
Hi

You should not change from the cumulative method to the month by month method during a tax year however if the director wants to change the NIC method you can do this from the new tax year (06/04/2022) going forward.

Thankyou.

Regards.

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