NIM09520 - Earnings Periods: Notifications issued in accordance with regulation 3(2B), SS(C)R 2001: Future calculation of contributions

If neither the employer nor the employee disputes the facts of the case, but the enquiry is about calculating contributions in future, tell the employer that the threshold and limits for the longer earnings period apply to the first payment made after issue of the notification and that they can deduct contributions ‘on account’ from payments made at the shorter interval before the higher threshold is reached, if the employee agrees. If this is done, the employer must:

• use the limits and threshold appropriate to the longer earnings period for the total earnings;
• enter the contributions on the Deductions Working Sheets as they are deducted;
• take them into account when the higher threshold is eventually reached; and
• pay the contributions to the Department with PAYE as normal.