NIM07006 - Class 1 NICs: Payments made under employment legislation: Guarantee payments: NICs treatment

Sections 28 and 34 Employment Rights Act 1996

A guarantee payment is earnings within the definition in section 3(1) of the Social Security Contributions & Benefits Act 1992. The amount of the guarantee payment should be included in the gross amount of the employee’s earnings for the relevant earnings period, and NICs calculated in the normal way on the gross amount.

For information about:

• what a guarantee payment is, see NIM07005
• the meaning of “earnings”, see NIM02010
• earnings periods, see NIM08000 onwards.