Paying Class 1A NICs 2023/24

We are approaching the online P11D and P11D(b) deadline for tax year 2023/24:

1. P11D to HMRC – by Saturday 06 July 2024
2. P11D to employees – by Saturday 06 July 2024

If a P11D has been completed, there may be an obligation for the employer to pay Class 1A National Insurance Contributions (NICs) a complete the P11D(b), so there are two other deadline dates to consider:

The Filing Date 

It is The Social Security (Contributions) Regulations 2001 that state the P11D(b) must be submitted by 06 July 2024. This is also confirmed at section 25 of HMRC's CWG5 Booklet ‘Class 1A National Insurance Contributions on Benefits in Kind’.  However, this also says:

If we do not receive the return by 19 July it will attract a penalty of £100 per month or part month of lateness, for every 50 or part-batch of 50 employees provided with benefits.’ 

So, what this means is that the deadline is 06 July, however, the penalty regime does not kick in until the 19^th.

The Payment Date

Section 71 of The Social Security (Contributions) Regulations 2001 is interpreted in the CWG5 that gives us the date on which Class 1A NICs must be paid to HMRC: 

• Friday 19 July 2024 if paying by post, or
• Monday 22 July 2024 if paying electronically.  Note that monies must appear as cleared funds in HMRC’s accounts, something that needs to be considered if payments are made via Bacs which take 3 working days

For bookkeepers

So;

• Filing the online P11D(b) by 06 July (though the penalty regime will not kick in until the 19^th)
• Paying the Class 1A NICs by 19 July (post) or 22 July (electronically)

ICB recommends viewing the Gov.UK guidance on paying Class 1A.

The fact there is a ‘grace period’ between 06 and 19 July for filing should not be seen as a green light to miss the deadline!  It is, though, something that members should consider if there is late filing. 

There is no such grace period for late payment.

Importantly, the payment must be accompanied by a payment reference number.  The purpose of this is to ensure HMRC allocate this as a payment of Class 1A rather than a regular monthly PAYE payment.

The number is a 17-character mutation as follows: 

• 13-character usual Accounts Office reference number, plus
• 2 characters indicating the calendar year in which the tax year finished, i.e. 24 for 2023/24 tax year, plus
• 2 characters indicating that this is the thirteenth monthly payment, i.e. 13

The 4-character suffix can be checked using HMRC’s reference checker tool for the relevant tax year, for example:

Action for bookkeepers:

1.     File (the P11D(b))

2.     Pay (the Class 1A NICs)

3.     Quote the reference number (so HMRC can allocate this correctly)