National Insurance Contributions are assessed on earnings and are, therefore, effectively another form of income tax. With careful planning, it is sometimes possible to minimise this tax cost, although consideration has to be given to the potential loss of state pension and benefits, if insufficient NIC’s are paid.
Our tax technicians can advise in relation to class 1, class 2, class 3 and class 4 national insurance contributions. In particular, clients are often interested in:
- The relative NIC costs of Salary v’s Dividends,
- Class 2 and 4 NIC for the self employed,
- NIC and share options,
- Class 1a NIC on benefits in kind,
- Saving class 1 NIC by salary sacrifice for employer pension contributions or childcare vouchers,
- Paying class 1 NIC quarterly instead of monthly,
- Outsourcing your class 1 NIC calculations to our payroll bureau service,
- NIC on the speculative development of part of your garden,
Advising HM Revenue & Customs and the Contributions Agency of your income which is liable to National Insurance Contributions is principally achieved by completing the employment supplementary pages of a normal personal self assessment tax return. Clients who are fearful that this liability may be investigated by HM Revenue & Customs may wish to consider taking out our tax investigation insurance.
Most people consider national insurance contributions as another unwelcome tax. As well as seeking to reduce this cost, our tax technicians will prepare all of the necessary paperwork and communicate with HMRC and the Contributions Agency on your behalf, so that you have peace of mind that your tax affairs are dealt with in a timely and professional manner.