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Class 2 NIC

Which is better

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Client earned below the level for class 2 but wants to make voluntary contributions. I've always believed that in these circumstances it's better to make payments separate from the tax return. Client says I'm wrong and I should just put them into the return

Who's right bearing in mind it's Friday??

Replies (11)

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RLI
By lionofludesch
18th Sep 2020 13:59

On the return.

I'm not sure you even have the option to pay separately any more. I suspect not. Even if you can, it won't be as easy as ticking the box on the return.

Why are you against it ?

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By bernard michael
18th Sep 2020 14:12

I read somewhere that HMRC have 2 systems for recording NIC and they don't talk to each other, which leaves the tax payer in difficulties over their pension payment

Perhaps it was a bad dream

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Replying to bernard michael:
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By Paul Crowley
18th Sep 2020 14:20

If NIC not set up correctly HMRC will amend the return to the correct figure per HMRC of Class4 in full but Class2 nil

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By Paul Crowley
18th Sep 2020 14:18

Not sure it is that simple
The return entry does not act as an application to volunteer. The return entry just adds the figure on to the computation.
The application to volunteer is separate
The only volunteer I have (that I know about) pays £3 by standing order to the ordinary SA tax account.

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Replying to Paul Crowley:
RLI
By lionofludesch
18th Sep 2020 14:24

Paul Crowley wrote:

Not sure it is that simple
The return entry does not act as an application to volunteer. The return entry just adds the figure on to the computation.
The application to volunteer is separate
The only volunteer I have (that I know about) pays £3 by standing order to the ordinary SA tax account.

£3 ? A week ? Wow.

That £3 will just get credited to his SA account, won't it ? Unless he elects to pay NI voluntarily, it'll just build up a repayable credit balance.

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Replying to lionofludesch:
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By bernard michael
18th Sep 2020 15:12

Exactly my worry. On balance I think I'm correct to suggest he pay separately

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Replying to bernard michael:
RLI
By lionofludesch
18th Sep 2020 15:28

bernard michael wrote:

Exactly my worry. On balance I think I'm correct to suggest he pay separately

Well, not exactly the same.

The point is that you need to tick the box to say he wants to pay voluntarily.

Just paying isn't enough. They need to know what it's for.

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Replying to lionofludesch:
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By Paul Crowley
18th Sep 2020 16:42

That is what happens and it works

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By SteveRA
18th Sep 2020 18:49

I have 4 voluntary class 2 payers and I tick the box for each of them to pay voluntarily and it is added to the balancing payment the followingg January, so Jan 21 for 19/20. They pay this with their income tax under SA just like anyone else. Lion is correct, no need to set up separate payments.

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blue sheep
By NH
20th Sep 2020 08:11

1. You have to register for class 2 NI
2. You tick the box on the SATR to pay class 2
3. You pay class 2 on the 31st Jan the same way you would pay SA tax.

Been like that for a few years now

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Replying to NH:
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By bernard michael
21st Sep 2020 14:47

Thanks everyone now sorted via the return by ticking the appropriate box, which took some finding

First one of these I've had to deal with

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