Explanatory note

These Regulations amend regulation 22 of the Social Security (Contributions) Regulations 2001 (S.I. 2001/1004) (“the Contributions Regulations”).

Regulation 1 provides for citation and commencement.

Regulation 2(2) inserts new paragraph (14) into regulation 22 of the Contributions Regulations. Paragraph (14) brings the amount of a termination award which is treated as earnings from the employment of the earner by virtue of section 402B Income Tax (Earnings and Pensions) Act 2003 into the definition of earnings contained in section 3 of the Social Security Contributions and Benefits Act 1992.

Regulation 2(3) inserts new paragraph (3A) into regulation 22B of the Contributions Regulations. Paragraph (3A) relieves a host employer, end client, UK agency or UK employer of liability for paying Class 1 primary and secondary National Insurance contributions on payments arising under Schedule 11 to the Finance (No. 2) Act 2017 that would otherwise fall to them as secondary contributors under regulation 5(1) of, and paragraph 9 of Schedule 3 to, the Social Security (Categorisation of Earners) Regulations 1978. This amendment comes into force on 5th April 2019.

A Tax Information and Impact Note covering the changes made by regulation 2(2) was published on 5 December 2016 and is available at: https://www.gov.uk/government/publications/income-tax-and-national-insurance-contributions-treatment-of-termination-payments/income-tax-and-national-insurance-contributions-treatment-of-termination-payments. It remains an accurate summary of the impacts that apply to that regulation.

A Tax Information and Impact Note covering the changes made by regulation 2(3) was published on 22 November 2017 and is available at: https://www.gov.uk/government/publications/disguised-remuneration-further-update/disguised-remuneration-further-update. It remains an accurate summary of the impacts that apply to that regulation.