COVID-19 continues to impact the registration process for National Insurance (NI) numbers.
An NI number is unique to each individual and does not change once allocated. It is used to identify an individual within the UK’s Social Security and tax systems and ensures that the National Insurance Contributions (NIC) an individual pays are properly recorded against their account, which, in turn, will be used when working out entitlement to certain benefits, such as a state pension.
An individual who has not automatically received an NI number around their 16th birthday or those individuals arriving in the UK who are planning to work (either employed or self-employed), looking to claim benefits or looking to pay voluntary contributions, will need to apply for one.
Currently only those individuals who have been granted permission to work in the UK by the Home Office prior to them coming to the UK are able to apply for an NI number. This is because the Department for Work and Pensions (DWP), the government department responsible for processing the NI number applications, are able to validate the applications with the Home Office without the requirement to interview the applicant.
For all other applicants whose right to work in the UK and identity details need to be checked and confirmed by DWP in a face-to-face interview, there is an issue - these interviews have been suspended since March 2020 due to the pandemic.
Unfortunately, it is not currently possible to offer a virtual service as there is a requirement to examine the applicant’s ID documents. However, DWP are in the process of developing a digital service to assist with the reinstatement of this service. Part of this process is to seek to introduce a new flexible online service that will meet the needs of a broader range of customers. However, this service is not expected to be available until well into the next tax year.
Whilst employers will want their employees to provide NI numbers when they first start work, an individual can still be employed before their number is received, provided that they can confirm that they are legally entitled to work in the UK.
For those individuals who are self-employed, they need to register for self-assessment for tax purposes and, as part of this process, will also need to register for Class 2 NIC. The catch is, an NI number is required in order to register for Class 2 NIC.
As an interim measure, HMRC have advised that a self-employed individual who does not have an NI number should note on their self-assessment registration form that the reason they are unable to obtain one is because DWP are currently not holding face-to-face interviews due to COVID-19. It is important that, once an NI number has been allocated, the self-employed individual contacts HMRC to register for Class 2 NIC.
Given that the face-to-face interviews have been suspended for a year, it is very likely that, once the restrictions are lifted, there will be a considerable backlog to work through. However, it is still important that individuals make every effort to ensure that they apply for their number as soon as they are able to do so.
If you would like to raise anything we’ve discussed in this article, please contact us at [email protected] and talk to our expert team. We’re here to help.
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