Old Employers NIC Liability

Old Employers NIC Liability

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Client has received a demand in form of a spreadsheet saying cat D table was used for certain employees but should have been Cat F resulting in an underpayment of £1523.70 including interest from 1997/8 and 1998/9 !!! Do they have to pay. This is the first communication they have had. If not please quote actual reference to why not.
Andy Shady

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By Paul Soper
31st Oct 2006 18:19

Stephen's right.
The problem that NICO have is that although there is no restriction in the legislation on the length of time retrospectively which they can determine, unlike the rest of HMRC which labour under time limits, as Stephen notes the statute of limitations prevents them enforcing the demands from more than 6 years ago, a limitation that other crown debts are not subject to.

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By stephenkendrew
31st Oct 2006 15:11

Limitation Act
Since the liabilities are more than 6 years old, I reckon they are not enforceable under The Limitation Act 1980 (section 9(1)).

I recently had a status enquiry when HMRC wanted the tax and NI going back several years. They put a county court claim in to keep the liabilities 'live' even though a court hearing was automatically adjourned until the appeal was settled. The first year was, however, over 6 years old (HMRC missed the deadline!) so dropped out of the claim because of The Limitation Act.

My CCH national insurance book says "where arrears are discovered that are more than six years old, it is a longstanding official practice to request payment of those arrears, even though enforcement is time-barred".

The NI people are, it seems, trying it on. If you don't pay there is little they can do.

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