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Taxpayers warned on NIC debts

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Taxpayers warned on NIC debts

People with unpaid national insurance contributions (NICs) have been warned that private debt collectors could be used to recover the money they owe HM Revenue & Customs (HMRC).

People paying tax through Pay As You Earn (PAYE) as an employee or who receive a taxable, UK-based private pension may have received a P2 annual coding notice for the 2014-15 tax year, which sets out their tax code for the year so that their employer or pension provider can deduct the correct amount of tax and national insurance.

In guidance issued on 24 March, HM Revenue & Customs (HMRC) said: “You may find that your tax code has changed, because starting from April 2014 HMRC can collect outstanding Class 2 national insurance contributions by adjusting your tax code.

“If a Class 2 national insurance contributions debt has been included in your tax code, we will have written to you earlier in the year requesting payment.

“The payment request also stated if you did not pay in full we could collect the debt through your PAYE code from April 2014 or pass it to a private debt collection agency for recovery on our behalf.

“If you do not want your Class 2 national insurance contributions outstanding debt to be included in your tax code, then you will need to pay the amount due in full.”

Class 2 NICs are those paid by people who are self-employed.

Link: How to make a Class 2 NICs payment

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