[^key-4c189cd8e6215d424ef3ebd198f0f733]: Words in Sch. 3 Pt. VIII para. 5 heading substituted (20.3.2025 for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 38(3), Sch. 8 para. 3(a) (with Sch. 8 Pt. 3)

[^key-fb403e1b19032ff5a41b5d0a3574fb4e]: Words in Sch. 3 Pt. VIII para. 5(a) substituted (20.3.2025 for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 38(3), Sch. 8 para. 3(b) (with Sch. 8 Pt. 3)

[^key-724305c3a56a7b11723555d42ec3d3df]: Sum in Reg. 10(d) substituted (3.4.2025 for the tax year 2025-26) by National Insurance Contributions (Secondary Class 1 Contributions) Act 2025 (c. 11), s. 2(2)

[^key-d5caa40b8cf05d3a39866d689a60a5ff]: Sum in Reg. 11(3A)(a) substituted (3.4.2025 for the tax year 2025-26) by National Insurance Contributions (Secondary Class 1 Contributions) Act 2025 (c. 11), s. 2(3)(a)

[^key-d5cdde51f7afb3a6549e2610962e94ea]: Sum in Reg. 11(3A)(b) substituted (3.4.2025 for the tax year 2025-26) by National Insurance Contributions (Secondary Class 1 Contributions) Act 2025 (c. 11), s. 2(3)(b)

[^key-b9a4500fd49d5f2106fbbfbd2cf29f4d]: Sch. 3 Pt. VI para. 16 inserted (6.4.2025) by The Social Security (Contributions) (Amendment No. 3) Regulations 2025 (S.I. 2025/325), regs. 1, 2

[^key-889d14546f3f03ac4ba339060c17f211]: Words in reg. 9 heading substituted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(2)(a)

[^key-02d0d11f25a87b4af0c2aaac4ca2c519]: Words in reg. 9(2) substituted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(2)(b)

[^key-7f05809379636c9879c84e368e2c2a0e]: Word in reg. 9(2A)(d) omitted (E.W.S.) (6.4.2025) by virtue of The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(2)(c)(i)

[^key-9d1d32045666624f6aa24577e5ce64f3]: Reg. 9(2A)(f) and word inserted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(2)(c)(ii)

[^key-626d70757f37f13e448a06432f81cca2]: Word in Sch. 4 para. 7(13)(b)(ix) omitted (E.W.S.) (6.4.2025) by virtue of The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(3)(a)(i)

[^key-31404caf3a38f426e2a1373571b4dc51]: Sch. 4 para. 7(13)(b)(xi) and word inserted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(3)(a)(ii)

[^key-e22024acb97ebc19cdf0ee60eb7696f8]: Word in Sch. 4 para. 9(1)(i) omitted (E.W.S.) (6.4.2025) by virtue of The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(3)(b)(i)

[^key-b97f2d4399c1f68d2ab8cbc610c3abef]: Sch. 4 para. 9(1)(k) and word inserted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(3)(b)(ii)

[^key-81419cdba94410cb3ea2d00e13329e86]: Words in Sch. 4 para. 11(4) substituted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(3)(c)

[^key-ca7198e3d0c030f91a9c87b7b1a3c369]: Word in Sch. 4 para. 22(1)(dc) omitted (E.W.S.) (6.4.2025) by virtue of The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(3)(d)(i)(aa)

[^key-d0b7e0e006ea49af2d99a898ef587a22]: Sch. 4 para. 22(1)(de) and word inserted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(3)(d)(i)(bb)

[^key-78d37fa59589ceb55ca6ea13eb347bf5]: Word in Sch. 4 para. 22(2)(dc) omitted (E.W.S.) (6.4.2025) by virtue of The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(3)(d)(ii)(aa)

[^key-37eb18141b10b2ab147961f23d2c9bd2]: Sch. 4 para. 22(2)(de) and word inserted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(3)(d)(ii)(bb)

[^key-3cbb390c4ef57cc8e9358ec30c5b2e2b]: Sch. 4A para. 20 inserted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(4)

[^key-30a0a48ee275c2b653d7f890aaa2296d]: Sch. 4B para. 5B inserted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment No. 4) Regulations 2025 (S.I. 2025/328), regs. 1, 2(5)

[^key-6e5abdec3e128eb960b2c8ab7be0fe43]: Sch. 4A para. 7A inserted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment) Regulations 2025 (S.I. 2025/144), regs. 1, 2(2)(a)

[^key-615dde3f3588ad2f40e8123309d57022]: Word in Sch. 4A para. 11 inserted (E.W.S.) (6.4.2025) by The Social Security (Contributions) (Amendment) Regulations 2025 (S.I. 2025/144), regs. 1, 2(2)(b)

[^key-665f134e17b7a70f64d5e10f90261687]: Word in Sch. 4 para. 21A(1)(b) inserted (coming into force in accordance with reg. 1 of the amending S.I.) by The Social Security (Contributions) (Amendment No. 2) Regulations 2025 (S.I. 2025/321), regs. 1, 3(a)

[^key-b851b544bf49e08747c733b224deaf1f]: Words in Sch. 4 para. 21A(1)(b) inserted (coming into force in accordance with reg. 1 of the amending S.I.) by The Social Security (Contributions) (Amendment No. 2) Regulations 2025 (S.I. 2025/321), regs. 1, 3(b)

[^key-c9b6ffff15b82cf8192ccc673f73cdeb]: Sch. 3 Pt. X para. 32 inserted (28.4.2025) by The Social Security (Contributions) (Amendment No. 5) Regulations 2025 (S.I. 2025/429), regs. 1, 2

[^key-6d608d062a4a8d56fd082da2f2cb487c]: Sch. 3 Pt. X para. 31(1) substituted (7.8.2025) by The Social Security (Contributions) (Amendment No. 6) Regulations 2025 (S.I. 2025/865), regs. 1, 2

[^key-9b540c77ca91098f5d95d261cc196e20]: Sch. 3 Pt. X para. 33 inserted (20.11.2025) by The Social Security (Contributions) (Amendment No. 7) Regulations 2025 (S.I. 2025/1132), regs. 1, 2

[^key-c12f0346b1073f9a87a4d03cec92d9cf]: Reg. 43(1)(e) substituted (15.3.2026) by The Social Security (Scotland) Act 2018 (Carer’s Assistance) (Consequential Modifications) Order 2026 (S.I. 2026/246), arts. 1(2), 56

[^key-f9e4fac8cd0ec1bbe21f69058cecc77b]: Word in reg. 10 substituted (6.4.2026) by The Social Security (Contributions) (Rates, Limits and Thresholds Amendments, National Insurance Funds Payments and Extension of Veteran’s Relief) Regulations 2026 (S.I. 2026/231), regs. 1, 5(2)(a)

[^key-b618212dfb800c0464fced6a8fc40761]: Sum in reg. 10(a) substituted (6.4.2026) by The Social Security (Contributions) (Rates, Limits and Thresholds Amendments, National Insurance Funds Payments and Extension of Veteran’s Relief) Regulations 2026 (S.I. 2026/231), regs. 1, 5(2)(b)

[^key-4d7f09102436312552fc653965c6e712]: Reg. 80(1AB) inserted (6.4.2026) by The Social Security (Contributions) (Amendment) Regulations 2026 (S.I. 2026/191), regs. 1, 2

[^key-0b5c012ad60985871baeb9212c4448c1]: Sum in reg. 125(c) substituted (6.4.2026) by The Social Security (Contributions) (Re-rating) Consequential Amendment Regulations 2026 (S.I. 2026/283), regs. 1(2), 2

[^key-684c16c7085142a2a844d6428d5d89e5]: Reg. 147(1) omitted (6.4.2026) by virtue of The Social Security (Contributions) (Amendment No. 2) Regulations 2026 (S.I. 2026/294), regs. 1(b), 2(2)(a) (with reg. 1(c))

[^key-cd8e945bc0da24cf90ac3957bc2df0fa]: Reg. 147(2) omitted (6.4.2026) by virtue of The Social Security (Contributions) (Amendment No. 2) Regulations 2026 (S.I. 2026/294), regs. 1(b), 2(2)(a) (with reg. 1(c))

[^key-69538dea1fd221790a19424723be1a3a]: Reg. 147(5)-(12) inserted (6.4.2026) by The Social Security (Contributions) (Amendment No. 2) Regulations 2026 (S.I. 2026/294), regs. 1(b), 2(2)(d) (with reg. 1(c))

[^key-e517c68039f220eb34ce8767eec225e3]: Words in reg. 147(3) substituted (6.4.2026) by The Social Security (Contributions) (Amendment No. 2) Regulations 2026 (S.I. 2026/294), regs. 1(b), 2(2)(b) (with reg. 1(c))

[^key-7e6b323d5c86e9866bd6d4113d4464e9]: Words in reg. 147(4) omitted (6.4.2026) by virtue of The Social Security (Contributions) (Amendment No. 2) Regulations 2026 (S.I. 2026/294), regs. 1(b), 2(2)(c) (with reg. 1(c))

[^key-d868eca0b5389fee3158867e41975d5b]: Word in reg. 147(4) substituted (6.4.2026) by The Social Security (Contributions) (Amendment No. 2) Regulations 2026 (S.I. 2026/294), regs. 1(b), 2(2)(c) (with reg. 1(c))

[^key-af51a3e70e8441c3a08cdf584e8b56c9]: Words in reg. 148 omitted (6.4.2026) by virtue of The Social Security (Contributions) (Amendment No. 2) Regulations 2026 (S.I. 2026/294), regs. 1(b), 2(3) (with reg. 1(c))

[^key-9cd1addd8fa5f81d017d64a853aa4237]: Sch. 3 Pt. 8 paras. 8C, 8D inserted (6.4.2026) by The Social Security (Contributions) (Amendment No. 3) Regulations 2026 (S.I. 2026/343), regs. 1, 2

Returns rendered electronically on another’s behalf

80A

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Penalties for failure to make a return and incorrect returns

Application of the Management Act to penalties for failure to make a return and incorrect returns

Special provisions relating to primary Class 1 contributions

Exception in relation to earnings to which regulation 84 applies

Special provisions relating to culpable employed earners and to secondary contributors or employers exempted by treaty etc., from enforcement of the Act or liability under it

Notification of commencement or cessation of payment of Class 2 or Class 3 contributions on or before 5th April 2009

Notification of change of address

Method of, and time for, payment of Class 2 and Class 3 contributions etc.

Arrangements approved by the Board for method of, and time for, payment of Class 2 and Class 3 contributions

Meal vouchers

6A

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3A

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Enterprise management incentives

Conditional interest in shares

Convertible shares

Shares acquired under options granted before 9th April 1998

Assignment or release of option

Exercise, assignment or release of options acquired before 6th April 1999

Rewards for assistance with lost or stolen cards

15

(1) A payment made by an issuer of charge cards, cheque guarantee cards, credit cards or debit cards, as a reward to an individual who assists in identifying or recovering lost or stolen cards in the course of his or her employment as an employed earner (other than employment by the issuer), together with any income tax paid by the issuer for the purpose of discharging any liability of the individual to income tax on the payment.

(2) In this paragraph—

“charge card” means a credit card, the terms of which include the obligations to settle the account in full at the end of a specified period;

“cheque guarantee card” means a card issued by a bank or building society for the purpose of guaranteeing a payment or supporting the encashment of a cheque up to a specified value;

“credit card” means a card which—may be used on its own to pay for goods or services or to withdraw cash, andenables the holder to make purchases and to draw cash up to a prearranged limit; and

“debit card” means a card linked to a bank or building society current account, used to pay for goods or services by debiting the holder’s account.

Amounts to be treated as earnings in connection with the use of qualifying vehicles other than cycles

22A

(1) To the extent that it would not otherwise be earnings, the amount specified in paragraph (2) shall be so treated.

(2) The amount is that produced by the formula—

$$RME-QA$Here— RME is the aggregate of relevant motoring expenditure within the meaning of paragraph (3) in the earnings period; and QA is the qualifying amount calculated in accordance with paragraph (4).$

(2A) But the amount in paragraph (2) is taken to be RME (without the subtraction of QA) so far as the aggregate of relevant motoring expenditure is paid pursuant to optional remuneration arrangements.

(3) A payment is relevant motoring expenditure if—

(a) it is a mileage allowance payment within the meaning of section 229(2) of ITEPA 2003;

(b) it would be such a payment but for the fact that it is paid to another for the benefit of the employee; or

(c) it is any other form of payment, except a payment in kind, made by or on behalf of the employer, and made to, or for the benefit of, the employee in respect of the use by the employee of a qualifying vehicle.

Manner of making sickness payments treated as remuneration

Certain payments by trustees to be disregarded

Payments to directors which are to be disregarded

Liability for Class 1 contributions in respect of earnings normally paid after pensionable age

Liability for Class 1 contributions of persons over pensionable age

Abnormal pay practices

Practices avoiding or reducing liability for contributions

Qualifying amounts of relevant motoring expenditure

7A

(1) To the extent that it would otherwise be earnings, the qualifying amount calculated in accordance with regulation 22A(4).

(2) Sub-paragraph (1) does not apply so far as the payment of relevant motoring expenditure within the meaning of regulation 22A(3) is made pursuant to optional remuneration arrangements.

Qualifying amounts of mileage allowance payment in respect of cycles

7B

(1) To the extent that it would otherwise be earnings, the qualifying amount of a mileage allowance payment in respect of a cycle.

(2) The qualifying amount is that which would be produced by the formula in regulation 22A(4) if the value for R were the rate for the time being approved under section 230(2) of ITEPA 2003 in respect of a cycle.

(3) In this paragraph—

“cycle” has the meaning given in section 192(1) of the Road Traffic Act 1988; and

“mileage allowance payment” has the meaning given in section 229(2) of ITEPA 2003.

Qualifying amounts of passenger payment

7C

(1) To the extent that it would otherwise be earnings, the qualifying amount of a passenger payment.

(2) The qualifying amount is that which would be produced by the formula in regulation 22A(4) if—

(a) references to business travel were to business travel for which the employee receives passenger payments within the meaning of section 233(3) of ITEPA 2003; and

(b) the value for R were the rate for the time being approved for a passenger payment under section 234 of ITEPA 2003.

(3) In this paragraph—

“passenger payment” has the meaning given in section 233(3) of ITEPA 2003; and

Car fuel

7D

(1) A payment by way of the provision of car fuel which is chargeable to income tax under section 149 of ITEPA 2003.

Car parking facilities

Specific and distinct payments of, or towards, expenses actually incurred

Council tax on accommodation provided for employee’s use

Rates on accommodation provided for employee’s use

Foreign service allowance

Commonwealth War Graves Commission and British Council: extra cost of living allowance

Overseas medical treatment

Decisions taken by officers of the Inland Revenue in respect of contributions which are prescribed for the purposes of section 8(1)(m) of the Transfer Act

155A

(1) For the purposes of section 8(1)(m) of the Transfer Act the decisions specified in paragraphs (2) to (5) are prescribed.

(2) The decisions specified in this paragraph are—

(a) whether a notice should be given under regulation 3(2B) and, if so, the terms of such a notice;

(b) whether a notice given under regulation 3(2B) should cease to have effect;

(d) whether the condition in regulation 50(2) is satisfied;

(e) whether a late application under regulation 52(8) for the refund of a contribution should be admitted;

(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(g) whether a late application under regulation 55(3) for the repayment of a Class 1A contribution should be admitted;

(h) whether, in a case where the secondary contributor has failed to pay a primary Class 1 contribution on behalf of the primary contributor, that failure was with the consent or connivance of the primary contributor or attributable to any negligence on the part of the primary contributor, as mentioned in regulation 60;

(i) whether the condition in regulation 61(2) is satisfied;

(j) whether, in the case of a Class 2 contribution remaining unpaid by the due date, the reason for the non-payment is the contributor’s ignorance or error, and, if so, whether that ignorance or error was due to his failure to exercise due care and diligence, as mentioned in regulation 65(2);

(k) whether the reason for a contributor’s failure to pay a Class 3 contribution within the period prescribed for its payment is his ignorance or error, and, if so, whether that ignorance or error was due to his failure to exercise due care and diligence, as mentioned in regulation 65(3);

(l) whether the reason for a contributor’s failure to pay a Class 3 contribution falling to be computed under section 13(6) of the Act and which remains unpaid after the end of the second year following the contribution year, is his ignorance or error and if so whether that ignorance or error was due to his failure to exercise due care and diligence, as mentioned in regulation 65(4); and

(m) whether a late application under regulation 110(3) for the return of a special Class 4 contribution should be admitted.

(3) The decisions specified in this paragraph are—

(a) whether a contribution (other than a Class 4 contribution) has been paid in error as mentioned in regulation 52(1); and

(b) whether there has been a payment of contributions in excess of the amount specified in regulation 21, as mentioned in regulation 52A(1),

to the extent that they are not decisions falling within section 8(1)(c) or (d) (decisions as to liability and entitlement to pay contributions) of the Transfer Act.

(4) The decisions specified in this paragraph are—

(a) whether the delay in making payment of a contribution, payable by an employer on behalf of an insured person, was neither with the consent or connivance of the insured person nor attributable to any negligence on the part of the insured person, as mentioned in regulation 23 of the National Insurance (Contributions) Regulations 1969;

(b) whether, in the case of a contribution paid after the due date, the failure to pay the contribution before that time was attributable to ignorance or error on the part of the insured person, and, if so, whether that ignorance or error was due to the failure on the part of the insured person to exercise due care and diligence, as mentioned in regulation 24 of those Regulations; and

(c) whether the failure to pay a contribution to which regulation 32 of those Regulations applies within the prescribed period was attributable to ignorance or error on the part of the person entitled to pay it and, if so, whether that ignorance or error was due to the failure of the person entitled to pay the contribution to exercise due care and diligence.

(5) The decisions specified in this paragraph are—

(a) whether the delay in making payment of a primary Class 1 contribution which is payable on a primary contributor’s behalf by a secondary contributor was neither with the consent or connivance of the primary contributor nor attributable to any negligence on the part of the primary contributor, as mentioned in regulation 5 of the Social Security (Crediting and Treatment of Contributions, and National Insurance Numbers) Regulations 2001 (treatment for the purpose of any contributory benefit of late paid primary Class 1 contributions where there was no consent, connivance or negligence by the primary contributor); and

(b) whether, in the case of a contribution paid by or in respect of a person after the due date, the failure to pay the contribution before that time was attributable to ignorance or error on the part of that person or the person making the payment and if so whether that ignorance or error was due to the failure on the part of such person to exercise due care and diligence, as mentioned in regulation 6 of the Social Security (Crediting and Treatment of Contributions, and National Insurance Numbers) Regulations 2001 (treatment for the purpose of any contributory benefit of contributions under the Act paid late through ignorance or error).

Northern Ireland

Revocations

Intermediaries

4A

(1) Where any payment of ... earnings of an employee is made by an intermediary of the employer, the employer shall be treated, for the purposes of this Schedule other than–

(a) paragraph 7(1),

(b) paragraph 7(3)(a),

(d) paragraph 7(11),

as making the payment of those ... earnings to the employee.

(2) For the purposes of this paragraph, a payment of ... earnings of an employee is made by an intermediary of the employer if it is made–

(a) either–

(i) by a person acting on behalf of the employer and at the expense of the employer, or

(ii) by a person connected with him, or

(b) by trustees holding property for any persons who include, or class of persons which includes, the employee.

(3) Section 839 of the Taxes Act (connected persons) applies for the purposes of this paragraph.

Inspectors and Collectors

Student loans

16

(1) A payment made in accordance with Regulations made under section 186 of the Education Act 2002 in respect of the repayment, reduction or extinguishing of the amounts payable in respect of a loan.

(2) A payment for the purpose of discharging any liability of the earner to income tax for any tax year where the income tax in question is tax chargeable in respect of—

(a) the payment referred to in paragraph (1), or

(b) the payment made for the purpose of discharging the income tax liability itself.

Annual maxima for those with more than one employment

Exception from Class 4 liability in respect of earnings from employed earner’s employment chargeable to income tax under Schedule D.

Reduced rate of primary Class 1 contributions otherwise payable at the main primary percentage

11A

(1) This paragraph applies for calculating or estimating the amount of earnings which is comprised in a payment which—

(a) would be disregarded in the computation of earnings for the purposes of earnings-related contributions by virtue of paragraph 16 of Part 9 of Schedule 3; but

(b) is not disregarded because paragraph 17 of that Part applies to it.

(2) If this paragraph applies, the amount of earnings to be taken into account for the purpose of earnings related contributions is the amount which would, but for paragraph 16 or 16A of Part 9 of Schedule 3, have been taken into account by virtue of section 4(4)(a) of the Act.

This is subject to the following qualification.

(3) If—

(a) the right to acquire shares in a body corporate is not capable of being exercised more than ten years after the date on which it was obtained,

(b) an amount of earnings was taken into account for the purpose of earnings-related contributions in respect of the earner’s obtaining that right, at the time he obtained it (“the deductible amount”), and

(i) that right,

(ii) any right replacing that right (“a replacement right”), or

(iii) any subsequent replacement right,

has occurred on or after 10th April 2003,

the deductible amount may be deducted from the amount otherwise to be taken into account by virtue of this paragraph.

Interpretation of paragraphs 9, 10 and 11

Apportionment of a payment from a retirement benefits scheme for the benefit of two or more people

Valuation of non-cash vouchers

Apportionment of earnings comprised in a cash or non-cash voucher provided for benefit of two or more employed earners

Payments resulting from exercise, assignment or release of options which are not disregarded by virtue of paragraph 16

17

(1) This paragraph applies to a payment—

(a) made on or after 10th April 2003, and

(b) which would otherwise fall to be disregarded by virtue of paragraph 16 or 16A of this Part,

where the market value of the shares has been increased by more than 10% by things done, on or after 6th April 1999, otherwise than for genuine commercial purposes.

(2) For the purposes of sub-paragraph (1) “the shares” includes—

(a) the shares subject to the right currently being exercised; and

(b) where the right to acquire shares held on 6th April 1999 has been replaced by a replacement right, includes the shares subject to a replacement right.

(3) The following are among the things that are, for the purposes of this paragraph, done otherwise than for genuine commercial purposes—

(a) anything done as part of a scheme or arrangement the main purpose, or one of the main purposes, of which is the avoidance of tax or of contributions under the Act; and

(b) any transaction between companies which, at the time of the transaction, are members of the same group on terms which are not such as might be expected to be agreed between persons acting at arm’s length.

(4) But sub-paragraph (3)(b) does not apply to a payment for group relief within the meaning given in section 402(6) of the Taxes Act.

(5) In sub-paragraph (3)(b) “group” means a body corporate and its 51% subsidiaries (within the meaning of section 838 of the Taxes Act), and other expressions used in this paragraph which are defined in, or for the purposes of, paragraph 16 have the same meaning here as they have in that paragraph.

Amounts to be treated as earnings

Prescribed general earnings in respect of which Class 1A contributions not payable

Convertible and restricted interests in securities and convertible and restricted securities

Convertible interest in shares

Assignment or release of right to acquire shares where neither right nor shares readily convertible

Assignment or release of a right, acquired as director or employee before 6th April 1999, to acquire shares where neither right nor shares readily convertible

Exercise of a replacement right to acquire shares, obtained as an earner before 6th April 1999

Securities

Certain payments by way of securities, restricted securities and restricted interests in securities, and gains arising from them, disregarded

Rights to acquire securities

Securities and interests in securities which are not readily convertible assets

7A

A payment by way of the acquisition of securities, interests in securities or securities options in connection with employed earner’s employment if, or to the extent that, what is acquired is not a readily convertible asset.

Restricted securities and restricted interests in securities

Payment of PAYE tax in respect of notional payment

17

A payment by way of income tax for which the employer is required to account to the Board under section 710(1) of ITEPA 2003 (notional payments: accounting for tax).

Employment Retention and Advancement payments

8

A payment made to a participant in an Employment Retention and Advancement Scheme, arranged under section 2(1) of the Employment and Training Act 1973, in his capacity as such.

Incapacity Benefit Return to Work Credit payments

9

A payment made to a participant in a Return to Work Credit Scheme, arranged under section 2(1) of the Employment and Training Act 1973 in his capacity as such.

Exception from Class 4 liability in respect of certain amounts chargeable to income tax under Schedule D

94A

Where —

(a) an earner has earnings from employment which is employed earner’s employment; and

(b) an amount representing those earnings is included in the calculation of the profits chargeable to income tax under Schedule D,

the earner shall be excepted from liability to pay contributions under section 15 of the Act (Class 4 contributions) on that amount.

Deferment of Class 4 liability where such liability is in doubt

Application for deferment of Class 4 liability

General conditions for application for, and issue of, certificates of exception and deferment

Revocation of certificates of exception and deferment

Calculation of liability for, and recovery of, Class 4 contributions after issue of certificate of deferment

Annual maximum of Class 4 contributions due under section 15 of the Act

Disposal of Class 4 contributions under section 15 of the Act which are not due

Repayment of Class 4 contributions under section 15 of the Act which are not due

Class 4 liability of earners treated as self-employed earners who would otherwise be employed earners

Notification of national insurance number and recording of category letter on deductions working sheet

Calculation of earnings for the purposes of special Class 4 contributions

Notification and payment of special Class 4 contributions due

Recovery of deferred Class 4 and special Class 4 contributions after appeal, claim or further assessment under the Income Tax Acts or appeal under section 8 of the Transfer Act

Annual maximum of special Class 4 contribution

Disposal of special Class 4 contributions paid in excess or error

Return of special Class 4 contributions paid in excess or error

5A

A non-cash voucher in respect of which no liability to income tax arises by virtue of section 266(2) of ITEPA 2003 if the voucher evidences entitlement to use anything the direct provision of which would fall within any of the following provisions of that Act—

(a) section 242 (works transport services);

(b) section 243 (support for public bus services);

(d) section 319 (mobile telephones).

5B

A non-cash voucher in respect of which no liability to income tax arises by virtue of section 266(3) of ITEPA 2003 if the voucher can be used only to obtain anything the direct provision of which would fall within any of the following provisions of that Act—

(a) section 245 (travelling and subsistence during public transport strikes);

(b) section 261 (recreational benefits);

(d) section 296 (armed forces' leave travel facilities);

(e) section 317 (subsidised meals);

(f) section 320A (eye tests and special corrective appliances).

Return to Work Credit

Return of contributions paid in error

Return of contributions paid in excess of maxima prescribed in regulation 21

52A

(1) This regulation applies if there has been a payment of contributions in excess of the maximum determined in accordance with regulation 21 (annual maxima for those with more than one employment) in the particular case.

Return of contributions: further provisions

Return of Class 1 contributions paid at the non-contracted out rate instead of at the contracted-out rate

Repayment of Class 1A contributions

Return of precluded Class 3 contributions

Calculation of return of contributions

Reallocation of contributions for benefit purposes

Circumstances in which two-year limit for refunds of Class 1, 1A or 1B contributions not to apply

PART 7A — Electronic Communications

Whether information has been delivered electronically

90A

(1) For the purposes of these Regulations, information is taken to have been delivered to an official computer system by an approved method of electronic communications only if it is accepted by that official computer system.

(2) References in these Regulations to information and to the delivery of information must be construed in accordance with section 135(8) of the Finance Act 2002 (mandatory e-filing).

Proof of content of electronic delivery

90B

(1) A document certified by the Board to be a printed-out version of any information delivered by an approved method of electronic communications is evidence, unless the contrary is proved, that the information—

(a) was delivered by an approved method of electronic communications on that occasion, and

(b) constitutes everything which was delivered on that occasion.

(2) A document which purports to be a certificate given in accordance with paragraph (1) is presumed to be such a certificate unless the contrary is proved.

Proof of identity of person sending or receiving electronic delivery

90C

The identity of—

(a) the person sending any information delivered by an approved method of electronic communications to the Board,

(b) the person receiving any information delivered by an approved method of electronic communications by the Board,

is presumed, unless the contrary is proved, to be the person recorded as such on an official computer system.

Information sent electronically on behalf of a person

90D

(1) Any information delivered by an approved method of electronic communications—

(a) to the Board, or

(b) to an official computer system,

on behalf of a person is taken to have been delivered by that person.

(2) But this does not apply if the person proves that the information was delivered without the person’s knowledge or connivance.

Proof of delivery of information sent electronically

90E

(1) The use of an approved method of electronic communications is presumed, unless the contrary is proved, to have resulted in the delivery of information—

(a) to the Board, if the delivery of the information has been recorded on an official computer system;

(b) by the Board, if the despatch of the information has been recorded on an official computer system.

(2) The use of an approved method of electronic communications is presumed, unless the contrary is proved, not to have resulted in the delivery of information—

(a) to the Board, if the delivery of the information has not been recorded on an official computer system;

(b) by the Board, if the despatch of the information has not been recorded on an official computer system.

(3) The time of receipt or despatch of any information delivered by an approved method of electronic communications is presumed, unless the contrary is proved, to be the time recorded on an official computer system.

Proof of payment sent electronically

90F

(1) The use of a method of electronic communications is presumed, unless the contrary is proved, to have resulted in the making of a payment—

(a) to the Board, if the making of the payment has been recorded on an official computer system;

(b) by the Board, if the despatch of the payment has been recorded on an official computer system.

(2) The use of a method of electronic communications is presumed, unless the contrary is proved, not to have resulted in the making of a payment—

(a) to the Board, if the making of the payment has not been recorded on an official computer system;

(b) by the Board, if the despatch of the payment has not been recorded on an official computer system.

(3) The time of receipt or despatch of any payment sent by a method of electronic communications is presumed, unless the contrary is proved, to be the time recorded on an official computer system.

Use of unauthorised method of electronic communications

90G

(1) This regulation applies to information which is required to be delivered to the Board or to an official computer system under a provision of these Regulations.

(2) The use of a method of electronic communications for the purpose of delivering such information is conclusively presumed not to have resulted in the delivery of that information, unless that method of electronic communications is for the time being approved for delivery of that kind under that provision.

Mandatory electronic payment

90H

(1) An employer who is a large employer within the meaning of regulation 198A (large employers) of the PAYE Regulations must pay the specified payment using an approved method of electronic communications

(2) Paragraph (1) applies regardless of whether a payment of tax is due under regulation 67G or 68 of the PAYE Regulations (payment and recovery of tax by employer).

(3) If the Board have given a direction under regulation 199(3) of the PAYE Regulations requiring a particular method of electronic communications to be used in the case of an employer, he must use that method.

(4) This regulation does not apply to a payment of contributions, whether primary or secondary, in respect of retrospective earnings where those earnings relate to a tax year which is closed (see paragraph 1(2) of Schedule 4) at the time the relevant retrospective contributions regulations come into force

(5) A specified payment is not treated as received in full by HMRC on or before the date by which that specified payment is required in accordance with paragraph 10 or paragraph 11 of Schedule 4 unless it is made in a manner which secures (in a case where the specified payment is made otherwise than in cash) that, on or before that date, all transactions can be completed which need to be completed before the whole amount of the specified payment becomes available to the Commissioners for Her Majesty’s Revenue and Customs.

Employer in default if specified payment not received by applicable due date

90I

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Default notice and appeal

90J

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Default surcharge

90K

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Surcharge notice and appeal

90L

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Specified information and specified payments

90M

In this Part—

“paragraph 22 return” means the return and accompanying information required by paragraph 22 of Schedule 4 (return by employer at the end of the year);

“specified payments” means payments of earnings-related contributions under paragraph 10 (payments made monthly by employer) or paragraph 11 (payments made quarterly by employer) of Schedule 4.

Mandatory use of electronic communications

90N

(1) An employer (as to which see regulation 90NA) must deliver a paragraph 22 return to an official computer system using an approved method of electronic communications.

(2) If the Commissioners for Her Majesty’s Revenue and Customs have made a direction under regulation 205(2) of the PAYE Regulations requiring a particular method of electronic communication to be used in the case of an employer, the employer must use that method.

(3) This regulation does not apply to a return in respect of retrospective earnings where those earnings relate to a tax year which is closed (see paragraph 1(2) of Schedule 4) at the time the relevant retrospective contributions regulations come into force.

Standards of accuracy and completeness

90O

(1) Any paragraph 22 return delivered by a method of electronic communications must meet the standards of accuracy or completeness set by specific or general directions given by the Board.

(2) Any paragraph 22 return which fails to meet those standards must be treated as not having been delivered.

Penalties and appeals

90P

(1) An employer who fails to deliver a paragraph 22 return or any part of it in accordance with regulation 90N is liable to a penalty.

(2) Table 2 sets out the penalties for employers for the tax year ending 5th April 2010, depending on the number of employees for whom particulars should have been included with the paragraph 22 return.

1 Number of employees for whom particulars should have been included with the return	2 Penalty
1-56-4950-249250-399400-499500-599600-699700-799800-899900-9991000 or more	0£100£600£900£1200£1500£1800£2100£2400£2700£3000

(2A) Table 3 sets out the penalties for employers for the tax years ending 5th April 2011 and subsequent years, depending on the number of employees for whom particulars should have been included with the paragraph 22 return.

1 Number of employees for whom particulars should have been included with the return	2 Penalty
1-56-4950-249250-399400-499500-599600-699700-799800-899900-9991000 or more	£100£300£600£900£1200£1500£1800£2100£2400£2700£3000

(3) An employer is not liable to a penalty if the employer had—

(a) a reasonable excuse for failing to comply with regulation 90N which had not ceased at the time the paragraph 22 return was delivered, or

(b) been subject to a penalty for failing to deliver the return and accompanying information required by regulation 73 of the PAYE Regulations (annual return of relevant payments liable to deduction of tax (Forms P35 and P14)) in accordance with regulation 205 (mandatory use of electronic communication) of those Regulations.

(4) A notice of appeal against a determination under section 100 of the Management Act of a penalty under this paragraph can only be on the grounds that—

(a) the employer did comply with regulation 90N,

(aa) the employer is not regarded as an employer for the purposes of regulation 90N,

(b) the amount of the penalty is incorrect, or

(5) Section 103A of the Management Act (interest on penalties) applies to penalties payable under this paragraph.

Appeals: supplementary provisions

90Q

(1) Section 31A(5) of the Management Act applies to appeals under regulation 90J as it applies to an appeal under section 31 of that Act.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Interpretation

90R

In this Part “the Management Act” means the Taxes Management Act 1970.

Apportionment of a payment to a retirement benefits scheme for the benefit of two or more people

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Employment Retention and Advancement payments

Return to Work Credit

Working Neighbourhoods Pilot

10

A payment made to a participant in a Working Neighbourhoods Pilot, arranged under section 2(1) of the Employment and Training Act 1973, in his capacity as such.

In-Work Credit

11

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The Social Security (Contributions) Regulations 2001

Returns rendered electronically on another’s behalf

80A

Penalties for failure to make a return and incorrect returns

Application of the Management Act to penalties for failure to make a return and incorrect returns

Set-off of Class 1A contributions falling to be repaid against earnings-related contributions

Special provisions relating to primary Class 1 contributions

Exception in relation to earnings to which regulation 84 applies

Special provisions relating to culpable employed earners and to secondary contributors or employers exempted by treaty etc., from enforcement of the Act or liability under it

Notification of commencement or cessation of payment of Class 2 or Class 3 contributions on or before 5th April 2009

Notification of change of address

Method of, and time for, payment of Class 2 and Class 3 contributions etc.

Arrangements approved by the Board for method of, and time for, payment of Class 2 and Class 3 contributions

Meal vouchers

6A

“Short” share options granted on or after 6th April 1999

3A

Enterprise management incentives

Priority share allocations

Partnership share agreements

Shares under employee share ownership plan

Shares under approved profit sharing schemes

Conditional interest in shares

Conditional interest in shares: gains from exercise etc. of share options

Convertible shares

Convertible shares: gains from the exercise etc. of share options

Share option gains by directors and employees

Shares acquired under options granted before 9th April 1998

Assignment or release of option

Exercise, assignment or release of options acquired before 6th April 1999

Rewards for assistance with lost or stolen cards

15

Amounts to be treated as earnings in connection with the use of qualifying vehicles other than cycles

22A

Manner of making sickness payments treated as remuneration

Calculation of earnings for the purposes of earnings-related contributions

Payments to be disregarded in the calculation of earnings for the purposes of earnings-related contributions

Certain payments by trustees to be disregarded

Payments to directors which are to be disregarded

Liability for Class 1 contributions in respect of earnings normally paid after pensionable age

Liability for Class 1 contributions of persons over pensionable age

Abnormal pay practices

Practices avoiding or reducing liability for contributions

Qualifying amounts of relevant motoring expenditure

7A

Qualifying amounts of mileage allowance payment in respect of cycles

7B

Qualifying amounts of passenger payment

7C

Car fuel

7D

Car parking facilities

Specific and distinct payments of, or towards, expenses actually incurred

Council tax on accommodation provided for employee’s use

Rates on accommodation provided for employee’s use

Foreign service allowance

Commonwealth War Graves Commission and British Council: extra cost of living allowance

Overseas medical treatment

Decisions taken by officers of the Inland Revenue in respect of contributions which are prescribed for the purposes of section 8(1)(m) of the Transfer Act

155A

Northern Ireland

Revocations

Intermediaries

4A

Inspectors and Collectors

Student loans

16

Annual maxima for those with more than one employment

Exception from Class 4 liability in respect of earnings from employed earner’s employment chargeable to income tax under Schedule D.

Reduced rate of primary Class 1 contributions otherwise payable at the main primary percentage

Exercise, assignment or release of share option — market value of option or resulting shares increased by things done otherwise than for genuine commercial purposes

11A

Interpretation of paragraphs 9, 10 and 11

Apportionment of a payment from a retirement benefits scheme for the benefit of two or more people

Valuation of non-cash vouchers

Apportionment of earnings comprised in a cash or non-cash voucher provided for benefit of two or more employed earners

Payments resulting from exercise, assignment or release of options which are not disregarded by virtue of paragraph 16

17

Amounts to be treated as earnings

Prescribed general earnings in respect of which Class 1A contributions not payable