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HMRC Underpaid Class 1 NIC

I'm receiving letters from HMRC advising underpaid Class 1 NIC

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Is anyone else receiving letters from HMRC relating to underpaid Class 1 NIC?  I have received 2 within last 48 hours for different clients, one a charity claiming CJRS and one a business not claiming CJRS.  Both refer to underpayment of Class 1 NIC, although both clients are registered for the Small Business Relief for the Employment Allowance.  Both statements go back to the beginning of the Tax Year, and I've checked the software and it's showing that the Employment Allowance is being claimed.  At first, I thought the charity one was because I was claiming CJRS, and I'd misunderstood and had to claim the Class 1 NIC through CJRS.  We've never claimed NIC through CJRS on the basis that employer was already receiving Employment Allowance, therefore definitely no double claim.

Is this just another issue with HMRC software?

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By Cat N
17th Sep 2020 12:31

You need to submit an EPS. HMRC is not picking up the employer's allowance - we've had these letters too for lots of our clients. An EPS should fix it.

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RLI
By lionofludesch
17th Sep 2020 14:06

This is for 2020/21 tax season, is it?

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Replying to lionofludesch:
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By Christine Marsh
08th Oct 2020 11:17

Hi it is, and now resolved with the submission of an additional EPS. Thanks

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By Steven Tucker
17th Sep 2020 16:02

Previously, if you claimed the employment allowance in one year, it was automatically claimed for the next year. This changed for the 2020/21 year and you need to send another EPS to claim it, even if you claimed it in 2019/20.

There are also some known issues with the employment allowance for some employers, as explained here: https://www.gov.uk/government/publications/epaye-service-availability-an...

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By Christine Marsh
08th Oct 2020 11:18

Thanks for the update on EPS, all submitted and received calls from HMRC to advise that accounts up to date.

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