Individual under employment is required to pay Class 1 employee’s national insurance contribution. It is the employer’s responsibility to deduct the contribution from staff pay and pay it over to UK tax office, the HM Revenue and Customs.
The UK national insurance contribution is administered by National Insurance Contributions Office (NICO).
National Insurance Number
Staff must provide their employer with his/her national insurance number, if the individual does not have a national insurance number he/she should apply to their local Jobcentre Plus Office for one. If the employee has a national insurance number but it has been lost then the person should contact HMRC.
National Insurance Contribution (NIC) Rates
The table below presents the current NIC rates that apply to employees and employers on salary payment.
| |
2010/11
|
2011/12
|
2012/13
|
| Employer's NIC |
12.8% |
13.8% |
13.8% |
| Employee's NIC: |
|
|
|
| - Lower earning limit |
£97 |
£102 |
£107 |
| - 11% Payable on weekly earnings of |
£110.01 to £844 |
£139.01 to £817 |
£146.01 to £770 |
| - 1% on earning above |
£844 |
£817 |
£817 |
Other Deductions
Employers are also required to deduct income tax on staff wages and pay it over to HMRC together with the employee’s and employer’s national insurance contributions.
Outsource Payroll Processing To Accountants
Working out income tax and national insurance contributions are burdensome and time consuming process for many small businesses with less than 5 staff. It is normally more efficient to ask your accountants to handle your payroll processing responsibility.
Concise Accountancy provides payroll services to small companies and growing businesses. Feel free to discuss your staff payroll with our accountants and they will provide you with value for money payroll package.
Concise Accountancy – Making Paying Staff Administration Simple For Small Businesses and Companies
