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NIM01290 | Class 1 structural overview from 6 April 2009: changes to the excess refund process from 6 April 2009

From HM Revenue & Customs · National Insurance Manual

Regulation 52A of the Social Security (Contributions) Regulations 2001 (SSCR 2001) (SI 2001 No 1004)

The introduction of an uncapped primary Class 1 liability on all earnings above the Upper Earnings Limit (UEL) means that each contributor will have an individual maximum based on the level of their earnings, it will continue to be possible for a person to pay in excess of their prescribed maximum.

This is because where a person fails to apply for deferment - see NIM01180 - they will pay Class 1 NICs at the:

  • main primary percentage on all earnings above the Primary Threshold (PT) up to and including the UEL in each employment

  • additional primary percentage on all earnings above the UEL in each employment.

Regulation 52A SS(C) R 2001 provides for the repayment of excess contributions and requires their return in a strict order of priority. This priority order ensures that contributions payable to the person’s chosen pension scheme are protected.