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Amendment to Self employed Class 2 NIC

Has anyone had self employed tax calculations returned with Class 2 removed but Class 4 due?

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Hi,  I have recently started receiving tax calculations for 19/20 tax returns, that have been amended in relation to the removal of Class 2 NIC contributions. 

We have spoken to HMRC who have stated that we should have ticked the voluntary contributions for Class 2, however the client is at a level of profit that means they are due to pay Class 4 so by default will be earning enough to be liable for Class 2? (NB the only income on the return is for self employment.)

Also the software automatically includes it if it is due and it is quite clearly showing on our Tax calculation submitted, but for some reason HMRC have removed it due to "Information they hold"!

Has anyone else come across this or is it just us?!!  Confused to say the least!

Replies (10)

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Replying to gainsborough:
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By Tri622
26th Jan 2021 18:32

Thanks for taking the time to point me in the right direction. I seem to remember this now I've read the articles!! This client has only started trading again this year so this will be why!

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RLI
By lionofludesch
26th Jan 2021 18:12

"Hi, I have recently started receiving tax calculations for 19/20 tax returns, that have been amended in relation to the removal of Class 2 NIC contributions.

"Has anyone else come across this ?!! "

Everybody, I would imagine.

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Replying to lionofludesch:
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By Tri622
26th Jan 2021 18:33

Thanks for your most helpful contribution! Happy Tuesday

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Replying to lionofludesch:
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By Tri622
26th Jan 2021 18:33

Thanks for your most helpful contribution! Happy Tuesday

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By Paul Crowley
26th Jan 2021 18:37

Do not believe HMRC
Complete CWF 1

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Replying to Paul Crowley:
RLI
By lionofludesch
26th Jan 2021 19:12

Paul Crowley wrote:

Do not believe HMRC
Complete CWF 1

[chuckle]

I remember being asked to do this around 2016 and they wrote back querying the start date of 1993.

"You can't pay up 20odd years", they said.

"They're already paid, pal, despite you saying CWF1 hasn't been sent in", I said.

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Replying to Paul Crowley:
By SteveHa
27th Jan 2021 08:56

As I've said before, I disagree. The matters of a CWF1 and the HMRC amendment are two separate matters, and the correct way to deal with the incorrect amendment is a TMA 1970 S9ZB(4) objection.

Despite what HMRC say.

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By Matrix
26th Jan 2021 20:02

It is such a mess. Client had his class 2 mysteriously removed for 2019-20 whereas had paid it for years, including 2018-19.

I have now called the SA helpline and the NI helpline who both promised to fix it but there is still a credit on the account. Tax return was filed early June.

This will be a huge issue. Practitioners need to be on top of this issue to spot it and unrepresented taxpayers will end up with missing years.

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Replying to Matrix:
RLI
By lionofludesch
27th Jan 2021 09:13

Mess ? The whole NI structure is a mess.

A self employed fella on £5200 can elect to pay Class 2 volutarily.

An employee on £100 a week has to pay five times as much in Class 3 contributions.

Why ?

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