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Posted Wed, 19 Apr 2023 10:15:06 GMT by John Clark
I've received the below from HMRC "Legislation, introduced from 6 April 2020 confirmed that a termination payment in excess of the £30,000 exemption for tax, now attracts a Class 1A NIC liability at 13.8% on the balance above £30,000. Your RTI submissions indicate that you made tax free payment(s) of £30,000 or more but did not return any Class 1A NICs due if those payments were indeed Termination payments." Fair enough, but our records show that we made redundancy payments of exactly 30k so if I'm reading it correctly, class 1a NIC of 13.8% should be on any of the costs over 30k and therefore the payments we made would not attract Class 1A? (Any other payments we may have made in that period were treated as taxable/NI'able on the FPS) Is my interpretation correct that the 30k does not attract Class 1a NIC
Posted Wed, 19 Apr 2023 14:59:47 GMT by HMRC Admin 10
Hi
If you have reported this correctly then I would disregard the message as you would only incur a class 1a charge for amounts over £30,000.
Thankyou.
Posted Thu, 21 Sep 2023 08:59:10 GMT by
Hi Dose the employee needs to pay NICs for taxable redundancy? It looks like it only for employer's Class 1A NIC? BR
Posted Tue, 26 Sep 2023 09:46:37 GMT by HMRC Admin 17

Hi,
 
If you have established that the amount being paid qualifies for the £30,000 exemption
then anything over this would be subject to tax and Class 1A  .

Thank you.

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