PSA3010 - National Insurance Contributions and PAYE Settlement Agreements: General
An employer who enters into a PSA is liable for the payment of Class 1 B NICs in addition to their liability to tax under the PSA. The legislation relating to Class 1BNICs is shown at PSA3020
Class 1B NICs are payable on
- items within a PSA that ordinarily attract a Class 1 PSA3040 or Class 1A NICs liability, PSA3030
and - the total tax payable under a PSA
Class 1B NICs replace any Class 1 or Class 1A NICs liability attached to the benefits and expenses included in a PSA for tax purposes
Only items that attract a tax charge can be included in a PSA. You cannot use a PSA
- where there is NICs only liability, or
- to cover elements which have NICs only liability
More detailed information about Class 1B NICs can be found in the National Insurance Manual at NIM18000 onwards