The Social Security (Crediting and Treatment of Contributions, and National Insurance Numbers) Regulations 2001

Made: 7th March 2001

Laid before Parliament: 13th March 2001

Coming into force: 6th April 2001

The Secretary of State for Social Security, with the concurrence of the Inland Revenue in so far as required, in exercise of powers conferred by sections 13(3), 22(5), 122(1) and 175(1) to (4) of, and paragraphs 8(1)(d) and (1A) and 10 of Schedule 1 to, the Social Security Contributions and Benefits Act 1992 and sections 182C and 189(1) and (3) to (6) of the Social Security Administration Act 1992 and of all other powers enabling him in that behalf and for the purpose only of consolidating other regulations hereby revoked, hereby makes the following Regulations:

Citation, commencement and interpretation

1

• (1) These Regulations may be cited as the Social Security (Crediting and Treatment of Contributions, and National Insurance Numbers) Regulations 2001 and shall come into force on 6th April 2001.

• (2) In these Regulations, including this regulation—

• “the Act” means the Social Security Contributions and Benefits Act 1992;

• “the Contributions Regulations” means the Social Security (Contributions) Regulations 2001;

• “contribution week” means a period of seven days beginning with midnight between Saturday and Sunday;

• “contribution-based jobseeker’s allowance” means an allowance under the Jobseekers Act 1995 as amended by the provisions of Part 1 of Schedule 14 to the Welfare Reform Act 2012 that remove references to an income-based allowance, and a contribution-based allowance under the Jobseekers Act 1995 as that Act has effect apart from those provisions;

• “contributory benefit” includes a contribution-based jobseeker’s allowance but not an income-based jobseeker’s allowance and includes a contributory employment and support allowance but not an income-related employment and support allowance;

• “contributory employment and support allowance” means an allowance under Part 1 of the Welfare Reform Act as amended by the provisions of Schedule 3, and Part 1 of Schedule 14, to the Welfare Reform Act 2012 that remove references to an income-related allowance, and a contributory allowance under Part 1 of the Welfare Reform Act as that Part has effect apart from those provisions;

• “due date” (subject to regulation 4(11)) means, in relation to—any Class 1 contribution, the date by which payment falls to be made;any Class 2 contribution which a person is ... entitled to pay or is treated as having actually paid as a result of section 11(5B) of the Act , the 31st January following the end of the year in respect of which it is payable;any Class 3 contribution, the date 42 days after the end of the year in respect of which it is paid;

• “earnings factor” has the meaning assigned to it in section 21(5)(c) of the Act;

• “income-based jobseeker’s allowance” has the same meaning as in the Jobseekers Act 1995;

• “income-related employment and support allowance” means an income-related allowance under Part 1 of the Welfare Reform Act (employment and support allowance);

• “relevant benefit year” has the meaning assigned to it in—section 2(4)(b) of the Jobseekers Act 1995, in relation to a contribution-based jobseeker’s allowance;paragraph 2(6)(b) of Schedule 3 to the Act (contribution conditions for entitlement to short-term incapacity benefit), in relation to short-term incapacity benefit;paragraph 3(1)(f) of Schedule 1 to the Welfare Reform Act (conditions relating to national insurance), in relation to a contributory employment and support allowance.

• “relevant time”, in relation to short-term incapacity benefit, has the meaning assigned to it in paragraph 2(6)(a) of Schedule 3 to the Act;

• “the Welfare Reform Act” means the Welfare Reform Act 2007;

• “year” means tax year.

• (3) In these Regulations, “official error” means an error made by—

• (a) an officer of the Department for Work and Pensions or an officer of Revenue and Customs acting as such which no person outside the Department or Her Majesty’s Revenue and Customs caused or to which no person outside the Department or Her Majesty’s Revenue and Customs materially contributed; or

• (b) a person employed by a service provider and to which no person who was not so employed materially contributed,

but excludes any error of law which is shown to have been an error by virtue of a subsequent decision of the Upper Tribunal or the court.

• (4) In paragraph (3)—

• ...

• “service provider” means a person providing services to the Secretary of State for Work and Pensions or to Her Majesty’s Revenue and Customs.

Appropriation of Class 3 contributions

2

Any person paying Class 3 contributions in one year may appropriate such contributions to the earnings factor of another year if such contributions are payable in respect of that other year or, in the absence of any such appropriation, the Inland Revenue may, with the consent of the contributor, make such appropriation.

Crediting of Class 3 contributions

3

Where, for any year, a contributor’s earnings factor derived from—

• (a) earnings upon which primary Class 1 contributions have been paid or treated as paid;

• (b) credited earnings;

• (c) Class 2 or Class 3 contributions paid by or credited to him; or

• (d) any or all of such earnings and contributions,

falls short of a figure which is 52 times that year’s lower earnings limit for Class 1 contributions by an amount which is equal to, or less than, half that year’s lower earnings limit, that contributor shall be credited with a Class 3 contribution for that year.

Treatment for the purpose of any contributory benefit of late paid contributions

4

• (1) Subject to the provisions of regulations 4A and 5 to 6C below and regulation 61 of the Contributions Regulations (voluntary Class 2 contributions not paid within permitted period), for the purpose of entitlement to any contributory benefit, paragraphs (1B) to (9) below shall apply to contributions (“relevant contributions”)—

• (a) paid after the due date; or

• (b) treated as paid after the due date under regulation 7(2) below.

• (1A) Any relevant contribution which is paid—

• (a) by virtue of an official error; and

• (b) more than six years after the end of the year in which the contributor was first advised of that error,

shall be treated as not paid.

• (1B) Where contributions are paid in accordance with regulation 63A of the Social Security (Contributions) Regulations 2001 (collection of unpaid Class 2 contributions through PAYE code), any relevant contributions are to be treated as paid on 5th April of the tax year in which they are paid.

• (2) Subject to the provisions of paragraph (4) below, any relevant contribution other than one referred to in paragraph (3) below—

• (a) if paid after the end of the second year—

• (i) ... following the year in which liability for that contribution arises or,

• (ii) following the year in respect of which a person is entitled, but not liable, to pay the contribution,

shall be treated as not paid;

• (b) if paid before the end of the said second year, shall, subject to paragraphs (7) and (8) below, be treated as paid on the date on which payment of the contribution is made.

• (3) Subject to the provisions of paragraph (4) below, any relevant Class 2 contribution payable in respect of a contribution week after 5th April 1983 or any relevant Class 3 contribution payable in respect of a year after 5th April 1982—

• (a) if paid after the end of the sixth year—

• (i) ...following the year in which liability for that contribution arises or,

• (ii) following the year in respect of which a person is entitled, but not liable, to pay the contribution, or

• (iii) following the year in respect of which the person is treated as having actually paid the contribution (as a result of section 11(5B) of the Act),

shall be treated as not paid;

• (b) if paid before the end of the said sixth year, shall, subject to paragraphs (7) or (8) below, be treated as paid on the date on which payment of the contribution is made.

• (4) A Class 3 contribution payable by a person to whom regulation 48(3)(b)(ii) or (iii) of the Contributions Regulations (which specify the conditions to be complied with before a person may pay a Class 3 contribution) applies in respect of a year which includes a period of education, apprenticeship, training, imprisonment or detention in legal custody such as is specified in that regulation—

• (a) if paid after the end of the sixth year specified in that regulation, shall be treated as not paid;

• (b) if paid before the end of the said sixth year shall, subject to the provisions of paragraphs (7) and (8) below, be treated as paid on the date on which payment of the contribution is made.

• (5) Notwithstanding the provisions of paragraph (4) above, for the purpose of entitlement to any contributory benefit, where—

• (a) a Class 3 contribution other than one referred to in sub-paragraph (b) below which is payable in respect of a year specified in that sub-paragraph, is paid after—

• (i) the due date, and

• (ii) the end of the second year following the year preceding that in which occurred the relevant time or, as the case may be, the relevant event,

that contribution shall be treated as not paid;

• (b) in respect of a year after 5th April 1982, a Class 3 contribution which is payable in respect of a year specified in paragraph (4) above, is paid after—

• (i) the due date, and

• (ii) the end of the sixth year following the year preceding that in which occurred the relevant time or, as the case may be, the relevant event,

that contribution shall be treated as not paid.

• (6) For the purposes of paragraph (5) above, “relevant event” means the date on which the person concerned attained pensionable age or, as the case may be, died under that age.

• (7) Notwithstanding the provisions of paragraphs (2), (3) and (4) above, in determining whether the relevant contribution conditions are satisfied in whole or in part for the purpose of entitlement to any contributory benefit, any relevant contribution which is paid within the time specified in paragraph (2)(b), (3)(b) or, as the case may be, (4)(b) above shall be treated—

• (a) for the purpose of entitlement in respect of any period before the date on which the payment of the contribution is made, as not paid; and

• (b) subject to the provisions of paragraph (8) below, for the purpose of entitlement in respect of any other period, as paid on the date on which the payment of the contribution is made.

• (7A) In determining whether the relevant contribution conditions are satisfied in whole or in part for the purpose of entitlement to any contributory benefit, any relevant contribution which is treated as paid on the date specified in paragraph (1B) shall be treated—

• (a) for the purpose of entitlement in respect of any period before the date on which payment of the contribution is treated as paid, as not paid; and

• (b) subject to the provisions of paragraph (8) below, for the purpose of entitlement in respect of any other period, as paid on the date specified in paragraph (1B).

• (8) For the purpose of determining whether the second contribution condition for entitlement to a contribution-based jobseeker’s allowance or a contributory employment and support allowance is satisfied in whole or in part a relevant contribution is to be treated—

• (a) if a Class 1 contribution paid before the beginning of the relevant benefit year, as paid on the due date;

• (b) if, subject to paragraph (2)(a), a Class 1 contribution paid after the end of the benefit year immediately preceding the relevant benefit year or, subject to paragraph (3)(a), a Class 2 contribution—

• (i) as not paid in relation to the benefit claimed in respect of any day before the expiry of a period of 42 days (including Sundays) commencing with the date on which the payment of that contribution is made; and

• (ii) as paid at the expiry of that period in relation to entitlement to such benefit in respect of any other period.

• (9) For the purposes of paragraph (8) above, “second contribution condition” in relation to—

• (a) a contribution-based jobseeker’s allowance is a reference to the condition specified in section 2(1)(b) of the Jobseekers Act 1995 ;

• (b) short-term incapacity benefit is a reference to the condition specified in paragraph 2(3) of Schedule 3 to the Act.

• (c) a contributory employment and support allowance is a reference to the condition specified in paragraph 2(1) of Schedule 1 to the Welfare Reform Act

• (10) This regulation shall not apply to Class 4 contributions.

• (11) Where an amount is retrospectively treated as earnings (“retrospective earnings”) by regulations made by virtue of section 4B(2) of the Act , the “due date” for earnings-related contributions in respect of those earnings is the date given by paragraph 11A of Schedule 4 to the Social Security (Contributions) Regulations 2001, for the purposes of this regulation and regulations 5 and 5A.

Treatment for the purpose of any contributory benefit of Class 2 contributions treated as paid where relevant profits notified late

5

• (1) This regulation applies where a primary Class 1 contribution which is payable on a primary contributor’s behalf by a secondary contributor—

• (a) is paid after the due date; or

• (b) in relation to any claim for—

• (i) a contribution-based jobseeker’s allowance, is not paid before the beginning of the relevant benefit year, ...

• (ii) short-term incapacity benefit, is not paid before the relevant time, or

• (iii) a contributory employment and support allowance, is not paid before the beginning of the relevant benefit year,

and the delay in making payment is shown to the satisfaction of an officer of the Inland Revenue not to have been with the consent or connivance of, or attributable to any negligence on the part of, the primary contributor.

• (2) Where paragraph (1) above applies, the primary Class 1 contribution shall be treated—

• (a) for the purpose of the first contribution condition of entitlement to a contribution-based jobseeker’s allowance, short-term incapacity benefit or a contributory employment and support allowance, as paid on the day on which payment is made of the earnings in respect of which the contribution is payable; and

• (b) for any other purpose relating to entitlement to any contributory benefit, as paid on the due date.

• (3) For the purposes of this regulation—

• (a) “first contribution condition” in relation to—

• (i) a contribution-based jobseeker’s allowance is a reference to the condition specified in section 2(1)(a) of the Jobseekers Act 1995 ,

• (ii) short-term incapacity benefit is a reference to the condition specified in paragraph 2(2) of Schedule 3 to the Act ;

• (iii) a contributory employment and support allowance is a reference to the condition specified in paragraph 1(1) of Schedule 1 to the Welfare Reform Act;

• (b) “primary contributor” means the person liable to pay a primary Class 1 contribution in accordance with section 6(4)(a) of the Act (liability for Class 1 contributions);

• (c) “secondary contributor” means the person who, in respect of earnings from employed earner’s employment, is liable to pay a secondary Class 1 contribution in accordance with section 6(4)(b) of the Act.

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

6

• (1) In the case of a contribution paid by or in respect of a person after the due date, where—

• (a) the contribution is paid after the time when it would, under regulation 4 or 5 above, have been treated as paid for the purpose of entitlement to contributory benefit; and

• (b) it is shown to the satisfaction of an officer of the Inland Revenue that the failure to pay the contribution before that time is attributable to ignorance or error on the part of that person or the person making the payment and that that ignorance or error was not due to any failure on the part of such person to exercise due care and diligence.

an officer of the Inland Revenue may direct that, for the purposes of those regulations, the contribution shall be treated as paid on such earlier day as the officer considers appropriate in the circumstances, and those regulations shall have effect subject to any such direction.

• (2) This regulation shall not apply to a Class 4 contribution.

Treatment for the purpose of any contributory benefit of duly paid primary Class 1 contributions in respect of retrospective earnings

7

• (1) Subject to the provisions of paragraph (2), for the purpose of entitlement to any contributory benefit except a contribution-based jobseeker’s allowance or a contributory employment and support allowance, where—

• (a) a person pays a Class 2 contribution under section 11 of the Act, or a Class 3 contribution in accordance with regulation 89, 89A, 90 or 148C of the Contributions Regulations (provisions relating to the method of, and time for, payment of Class 2 and Class 3 contributions etc.); and

• (b) the due date for payment of that contribution or (in the case of a contribution treated as paid as a result of section 11(5B) of the Act) the first day on which the contribution would otherwise be treated as having been paid, is a date after the relevant day,

that contribution is treated as paid by the relevant day.

• (2) Where, in respect of any part of a late notification period, a person pays a Class 2 contribution which he is ... entitled to pay, that contribution shall be treated as paid after the due date, whether or not it was paid by the due date.

• (3) For the purposes of this regulation—

• (a) “late notification period” means the period beginning with the day a person ... entitled to pay a Class 2 contribution was first required to notify the Inland Revenue in accordance with the provisions of regulation 87, 87A or 87AA of the Contributions Regulations (notification of commencement or cessation of payment of Class 2 or Class 3 contributions) and ending on the day on which he gives that notification;