Explanatory note

These Regulations further amend the Social Security (Contributions) Regulations 1979 (“the principal Regulations”).

Regulations 2 and 3 make minor drafting amendments to the principal Regulations. Regulation 2 amends regulation 32(1) to confine to Class 1 and Class 2 contributions a provision in that regulation specifying the minimum amount for the return of contributions paid in error or in excess. Regulation 3 amends regulation 33A(1) to clarify a reference to the person who has made an overpayment of a Class 1A contribution.

Regulations 4 to 15 amend Schedule 1 to the principal Regulations, which applies certain provisions of the Income Tax (Employments) Regulations 1973 (S.I. 1973/334), with extensions and modifications, to the collection of earnings-related contributions and Class 1A contributions.

Regulations 4, 6, 13 and 14 amend, respectively, Regulations 13(6), 25, 30 and 30A in Schedule 1. These amendments remove certain requirements on employers to record earnings from non-contracted-out employment on which primary Class 1 contributions are payable at the married women’s reduced rate. In the case of contracted-out employment, the amendments require the recording of earnings above the lower earnings limit on which primary Class 1 contributions are payable at the reduced rate and the amount of those contributions.

Regulation 7 amends Regulation 26A(3) in Schedule 1, to increase from £400 to £450 the amount which determines whether the option for quarterly payment of earnings-related contributions is available to an employer.

Regulation 9 inserts a Regulation 26D into Schedule 1. The inserted Regulation requires that, on a cessation of business, an employer shall pay any Class 1A contribution in respect of the current year within 14 days after the income tax month in which he makes the final payment of earnings to his employees; and that, on a change of employer, the employer before the change shall similarly pay any Class 1A contribution in respect of any employee whose employment ceased before the change occurred. The inserted Regulation also requires the recording of those contributions on the deductions working sheets and the annual return for that year.

Regulations 4, 5, 8, 10, 11, 12 and 13 make minor consequential amendments to Regulations 13(6), 13A, 26C, 27, 27B, 28 and 30, respectively, in Schedule 1, relating to the inserted Regulation 26D.

Regulation 11 also amends Regulation 27B to allow the Collector of Taxes, immediately after the date when payment is required under the Regulations in Schedule 1, to use the procedure for estimating the amount of unpaid Class 1A contributions which he considers an employer is liable to pay.

Regulation 15 amends Regulation 32 in Schedule 1, to make further provision for the inspection of the employer’s records and for the taking of copies or the removal of any documents produced for inspection.