Social Security Benefits
but excluding: • PAYE Income Tax paid on account to a contractor in the Construction Industry by a sub- contractor that is a limited company • amount of SAP, SMP, SPP, ShPP and SSP that the employer is entitled to recover. COPYRIGHT © 2021 THE CHARTERED IN TITUTE OF PAYROLL PROFESSIONALS *Depending on the corporate structure and the share of the levy allowance it is possible that a small business, despite having a paybill of less than £3m a year, may have to pay the levy. Employers and contractors in the construction industry, whose average monthly payments in respect of PAYE & NICs are less than £1,500 may remit their payments quarterly on the 22nd July, October, January and April or the 19th if they do not pay electronically (see quarterly payments above). Small Employers’ Relief (SER) for Statutory Payments Small Employers for this purpose are defined as those with a total Class 1 NICs of less than £45,000 in the year prior to the year the claim is made. If they qualify, they are entitled to recover 100% of their SMP, SPP, SAP payments plus compensation for the NICs paid of 3% (103% in total) (104.5% prior to 6th April 2011). To qualify for Small Employers Relief, the total gross employer’s plus employees’ Class 1 NICs across all PAYE schemes ‘in the organisation’ for the previous year must be less than the threshold. Date from Threshold £ Date from Threshold £ 06/04/2004 - 05/04/2006 40,000 6/04/2007 onwards 45,000 SOCIAL SECURITY BENEFITS The National Insurance Fund provides contributory-based benefits against loss of income for the disabled, retired, sick, unemployed and widowed. In addition, it provides some assistance for people with maternity expenses. The National Insurance Fund, established in 1911, is in truth not a fund in the generally understood manner. It is a pay-as-you-go scheme where current contributors fund current beneficiaries. No printing, copying or reproduction permitted. It should be noted that “small employer” has further complications in that different branches of government use different definitions. Examples are “small employer” for pension purposes being five or fewer employees, but the worst example is HMRC who, in addition to the two definitions above, also use fewer than 10 employees as an additional definition of “small employer”. Whilst the contribution record of an individual may provide the basis for calculating entitlements, the funding of those entitlements will come from contributions made from all current contributors. This is not an uncommon practice, particularly in the pension field. Some major public sector ‘funds’ relating to the Health Service, Police and Teachers - are financed on the same principle.
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