PART 3: NATIONAL INSURANCE
• marriage ended, other than by the death of the husband • re-marriage • earnings fall below the LEL for two successive years from 5th April 1978 (i.e. no NICs contributions deemed to be made in two successive years). Employers must have an annual process to check the validity of all reduced rate certificates to ensure the employee’s status continues to meet the above criteria, as the employer may be liable for any shortfall. Where an employee has been self-employed and paying NICs during the two years when no NICs from employment was due her right to reduced rate is retained. COPYRIGHT © 2021 THE CHARTERED INSTITUTE OF PAYROLL PROFESSIONALS UPPER ACCRUAL POINT (UAP) Introduced on the 6th April 2009 the UAP sets the upper limit for National Insurance contracted- out contribution rebates and is in addition to, not a replacement of, the Upper Earnings Limit (UEL). Up to the 5th April 2009 the UEL (which continues to be the upper earnings limit for standard rate contributions) was the upper earnings limit for both contributions and contracted- out rebates. From April 2009 employers and employees with occupational pension schemes contracted out of the State Second Pension (S2P) are only entitled to contracted-out rebates between the Lower Earnings Limit (LEL) and the UAP. All employers, including those who do not have occupational pension schemes, are required to record earnings between the Primary Threshold and UAP as well as those between the UAP and UEL. This continued until 5th April 2012, the date at which the option to contract out was abolished for members of defined contribution schemes, as they may have had employees in pension schemes into which HMRC make minimum payments which were also limited to the UAP from 6th April 2009. The additional earnings details will be required because only those earnings up to the UAP were used to calculate S2P rights. S2P rights earned up to 5th April 2016 have been retained now that S2P, the UAP and contracting-out for DB schemes has been abolished. VOUCHERS Are normally liable for tax and NICs, however their treatment depends on the nature of the voucher. For further details see PART 2 . No printing, copying or reproduction permitted.
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