NIC treatment of writing of an overdrawn DLA

Didn't find your answer?

Brief one.

Am struggling to get my head around a DLA for a close company write off being subject to class 1 NIC. Say for example a £10,000 DLA is written off to the DLA is it employers NIC and employees NIC chargeable meanings that a £1,200 and a £1,380 combined charge applies, both expenses of the company being a £2,580 expense being allowable for tax relief? Or is it just the employers element that I bring in.

Thank you in advance.

 

 

Replies (4)

Please login or register to join the discussion.

By johngroganjga
25th Sep 2018 16:12

Do you mean that the loan is being waived, or that the creditor company is just making an accounting adjustment to recognise that the debtor will probably be unable to pay?

Thanks (0)
avatar
By Practise_Accountant88
25th Sep 2018 16:21

The loan is being waived.

Thanks (0)
Replying to Practise_Accountant88:
By johngroganjga
25th Sep 2018 16:35

Then yes you have a National Insurance question to consider, which I will leave others to help you with.

Thanks (0)
By Ruddles
25th Sep 2018 16:33

“If”NI is chargeable it’s both. But just because the legislation says that NI might be chargeable don’t believe HMRC if they tell you that it must be.

Thanks (0)