DANSP37000 | Notices of decision: Wording of statutory payments decisions: Introduction to recovery of statutory payments and NIC compensation decisions

Some of the persons liable to pay statutory payments (SP’s) are entitled to recover some or all of the SP’s they pay to their employees. They can recover SP’s from payments they make to HMRC for their National Insurance contributions (NIC) and PAYE income tax, Student Loan repayments or Construction Industry Scheme deductions (see SPM180600).

For all SP’s (excluding Statutory Sick Pay (SSP)) employers can generally recover 92% of the payments they make to their employees. Small employees can recover 100% plus an additional compensation payment. Also, in certain circumstances, those persons liable to pay SP’s can claim NIC compensation on those payments.

Decisions to be made about recovery and NIC compensation claims in respect of all statutory payments (excluding SSP) are provided by:

• Section 8(1)(g)/(ga) of the Social Security Contributions (Transfer of Functions, etc.) Act 1999 or

• Article 7(1)(g)/(ga) of the Social Security Contributions (Transfer of Functions, etc) (Northern Ireland Order 1999)

Contact IPD (Statutory Payments Technical Team) if you need to issue such a decision.

If an employer who has paid SP’s has recovered too much they will have underpaid National Insurance contributions (NIC). In such cases where the employer will not accept that they have recovered too much, add a decision about liability to pay NIC, see example 3 in DANSP37100.

For examples of decisions see DANSP37100.