Disguised Remuneration – National Insurance Contributions Regulations

16 January 2012 |

Amounts chargeable to income tax under Part 7A of ITEPA are now treated as earnings for the purposes of National Insurance Contributions (“NICs”).

Regulations came into force on 6 December 2011 which make provision for amounts chargeable to income tax under the Disguised Remuneration legislation to be treated as earnings for the purposes of NICs if they would not already be treated as such.  They also include provision to prevent a double liability for NICs on such amounts.

The Regulations do not have retrospective effect so where there is no prior liability to account for Class 1 NICs, employers do not need to do so on any “disguised remuneration” amounts which have given rise to tax liabilities before 6 December 2011 and which have, or will be, subject to PAYE.


There are no surprises in the regulations as they largely reflect the draft regulations that were issued earlier in the year.  The real problem, of course, is that the complexity and uncertainty around the disguised remuneration legislation now extends to National Insurance as well as Income Tax.

For further information or to discuss the issues raised, please contact Guy Abbiss or John Mooney on +44 20 3051 5711.

The author


Also by the author

13 December 2013
Another victory for the UK Revenue against income tax avoidance
6 December 2013
Autumn statement 2013: Good news for employee share ownership and other welcome tax breaks
1 November 2013
Serious Fraud Office brings its first prosecution under the Bribery Act 2010 with more to come
Subscribe to our newsletter
Stay up to the minute on our latest news and insights?