New NI Codes for Freeports

5th August 2021

In case you thought the NI coding system was becoming too easy to follow, HMRC have announced 4 more NI codes in order to comply with the new regulations, starting in April 2022, for those companies trading within one of the newly established Freeport areas.


  • F – standard category letter
  • I – married women & widows entitled to pay reduced NIC’s
  • S – employees above state pension age
  • L – employees who defer paying 12% NIC, only paying 2% as they pay full contributions elsewhere.


In other words, these new codes match the existing A, B, C & J that will still be used by employees working for firms not working within the boundaries of one of the new Freeport areas.


In England, Scotland & Wales employers with a physical presence within a Freeport tax site can operate a zero-rated Employer Class 1 NIC’s for new employees who spend at least 60% of their time working within the Freeport tax site. New employees are classed as starting after April 2022 & must not have worked for the employer (or a business connected to the employer) in the previous 24 months. Existing employee are not included in the scheme. The zero rate can be applied up to a threshold of £25,000 per annum for a maximum period of 36 months for each employee. Earnings above £25,000, the Freeport Upper Secondary Threshold (FUST) will be charged at 13.8%.


The relief to employers who qualify for the new scheme is due to run for nine years ending in 2031. However, HMRC have stated they will review the policy part way through to determine whether or not it should continue.


Other items in Blogs
Harriet Sim
22nd October 2021 Self Assessment late payment penalties

HMRC are now issuing six month late payment penalty notices, as the due date for 2019/20 tax payments was over seven months ago (includes consideration to the additional months extension as a result of the pandemic). Taxpayers facing financial difficulties due to the impact of COVID-19 may have entered into a time to pay arrangement…

Nick Edgley
21st October 2021 Holiday lettings – declare to HMRC

If you own a UK holiday let are you declaring your rental profits to HMRC? If not time may be running out to make a voluntary disclosure of past profits.   HMRC has the power to request information, or documents, from third parties such as holiday booking sites; as well as being able to search…

Keri John
20th October 2021 Xero – Assigning Bills to Customers

You can now assign bills to customers in Xero!   This makes it easier to allocate expenses occurred during a job to the correct customer.   Perfect for Estate Agents, event planners and more.   When creating a bill to pay onto Xero there is an option to ‘assign the bill to a customer’. You…

Jake Day
20th October 2021 Minimising Your IHT Exposure

As Benjamin Franklin once said; the only two certainties in life are death and taxes. Although it’s a sombre subject, it is important to put in place the right planning so that when we are hit by one, we can avoid the other. We want to ensure we are able to leave as much of…

Paul Jefferson
19th October 2021 VAT Registration

A business must compulsorily register for VAT if taxable 12 month turnover exceeds £85,000. They can voluntarily register for VAT as soon as they start trading, providing they expect to make taxable supplies in the future.   Businesses that provide to other businesses may choose to register for VAT voluntarily before the registration threshold is…

Sharon Mace
13th October 2021 VAT DIY Scheme: HMRC update list of allowable expenses

There has been some controversy on claims made on DIY building schemes. HMRC have updated their guidance on goods and services that can be claimed under the VAT DIY Housebuilders’ Scheme.   The list is extensive and gives an ABC of items that are allowed, from Agas to woodworm treatment – but there’s a catch,…