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Where Taxpayers and Advisers Meet

HMRC wrongly calculating Class 2 NIC as zero

Fasteddie
Posts:22
Joined:Fri Nov 05, 2021 12:21 pm
HMRC wrongly calculating Class 2 NIC as zero

Postby Fasteddie » Mon Jan 09, 2023 6:45 pm

Completed an SA100 online today on HMRC website but despite client earning 30k and having always paid class 2 NIC and being again liable for them they are calculating his Class 2 NIC as 0.00 and I can't get round it by paying voluntarily as it won't allow that and gives me an error message if I tick the pay voluntarily box. He is about forty, receives no benefits and there's no reason he should be exempt and calculated at 0.00. Anyone else had this?

robbob
Posts:3228
Joined:Wed Aug 06, 2008 4:01 pm

Re: HMRC wrongly calculating Class 2 NIC as zero

Postby robbob » Mon Jan 09, 2023 6:55 pm

Unfortunately the class2NI maker is completely independent of what you enter on the tax return.

class2 ni team need to have logged start date for ni to work and also end date if there is in year cessation.

So for example if this client went from property rental to sole trader and you havent done specific start of trade notification diorectly to class2 team (outside of sa) (or that notification has not been processed) - then that needs to be done before ni will appear.
class2NI team can confirm if start date with no end date is on their system or not.

Another one could be incorrect end date notified to class2 - eg if client thought they were gfoing to cease rang up then changed their mind.

the other reason could be if client has qualified for stamp via other means - eg if they claimed employment support allowance - thats unlikely to be for a whole year so sounds like for whatever reason the flag is not set for this client to be live sole trader as far as class2 are concerned.

Fasteddie
Posts:22
Joined:Fri Nov 05, 2021 12:21 pm

Re: HMRC wrongly calculating Class 2 NIC as zero

Postby Fasteddie » Tue Jan 10, 2023 12:39 pm

Thanks Rob, I shall speak to the client and see if he has any recollection of having any communication with the NIC people in last year about anything or if he was going to cease trading or something similar then changed mind. Seems odd as he mentioned nothing of this to me and was just continuing his same trade which he's been at for years now. Perhaps when he changed address he ticked something inadvertently - that's the only possible explanation I can think of at present.

Fasteddie
Posts:22
Joined:Fri Nov 05, 2021 12:21 pm

Re: HMRC wrongly calculating Class 2 NIC as zero

Postby Fasteddie » Wed Jan 11, 2023 10:56 am

I spoke to the NI department and despite my client filing SA returns for last few years and paying class 2 he is apparently not registered self employed! She said he needs to fill out CWF1, how bizarre. More worryingly is that none of his class 2 NIC have been transferred across to the NI department and so don't show on his record. Maybe they are floating about in some kind of tax purgatory, lol. Luckily he has lots of years already on his record so shouldn't be an issue long term but it does make you wonder about other people who could be merrily paying their class 2 on SA each year and not knowing that they potentially aren't getting paid across to the NI record cos of some admin glitch years ago.


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