NIM12008 | Class 1: Calculating Class 1 for Directors: Fees received by other companies: No formal right to appoint a Director

Regulation 27(1) and Regulation 27(4) of the Social Security (Contributions) Regulations 2001 (SSCR 2001) (SI 2001 No 1004)

Regulations 27(1) and (4) SSCR 2001 exclude directors fees where there is no formal right to appoint the director but there are two differences to regulation 27(3) (NIM12007):

• there is no reference to income tax so the payment must form part of the chargeable profits to corporation tax only

• a control test is included so fees will only be excluded from Class 1 NICs liability if the director or other connected persons do not control the first company. For the definition of control, see NIM12009.