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Post Info TOPIC: Class 2 NI
Artois


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Class 2 NI
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Hi all

I have 2 clients recently where I have submitted their returns using Taxfiler, I always check the calculations before getting the clients to sign and then submit the return, both are on the CIS and are due refunds however when the refunds have come through they have had the £148.20 which Taxfiler rightly took off for Class 2 NI added back on by HMRC, both clients have no reason why they shouldn't be paying it.

Has anyone else had this and know why HMRC have not taken for Class 2 NI, because at the moment I suppose that this year will not count towards their pension.

Cheers



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Doug

These are only my opinions of how I see things and therefore should not be taken as advice
Kinbuck


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Morning Doug

I only have one client using CIS and Class 2 wasn't taken off him.  He got his refund this week and it was the exact amount calculated.  



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Janet

They keep making the system idiot proof but then make bigger and better idiots!
Artois


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Morning Janet, thanks for the reply

I have done others and they have all had Class 2 taken correctly just don't know why these 2 have had it added back so it remains unpaid, its nothing to do with CIS I was just using this because they are due a refund which is why I realised that the figure paid out compared to what it should have been was incorrect.

So did your client not have Class 2 taken off in the tax return calculations? Taxfiler rightly deducted it from the tax already deducted but HMRC have added it back on, did you submit your clients return using HMRC software? 



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Doug

These are only my opinions of how I see things and therefore should not be taken as advice
Kinbuck


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Sorry Doug...should have re-read that (it's too early on a Saturday and I'm baking for a fayre at the same time so not fully concentrating!!)  He did have Class 2 taken off biggrin



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Janet

They keep making the system idiot proof but then make bigger and better idiots!
Artois


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Kinbuck wrote:

Sorry Doug...should have re-read that (it's too early on a Saturday and I'm baking for a fayre at the same time so not fully concentrating!!)  He did have Class 2 taken off biggrin

 Thanks Janet

Are you in competition with Joanne for the Great Bookkeepers Bake Off ?  biggrin

Enjoy the fayre



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Doug

These are only my opinions of how I see things and therefore should not be taken as advice
Kinbuck


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Artois wrote:

Are you in competition with Joanne for the Great Bookkeepers Bake Off ?  biggrin

 

 On today's efforts no, but normally...I make crackin caramel shortcake and carrot cake muffins (among other things) biggrin



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Janet

They keep making the system idiot proof but then make bigger and better idiots!
Cheshire


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Kinbuck wrote:
Artois wrote:

Are you in competition with Joanne for the Great Bookkeepers Bake Off ?  biggrin              what?    noooooo

 

 On today's efforts no, but normally...I make crackin caramel shortcake and carrot cake muffins (among other things) biggrin

Shaun will be drooling!

Im will be making a (baked) cheesecake later, plus espresso jellies and cardamon & (? - havent decided, passion fruit if I can get it) panna cotte.  I know strictly speaking the latter arent baking.

Maybe some cookies.

On the subject of the original Q - this started occuring back in 2016 when the software houses had updated their bits for SA, but HMRC for some odd reason (why are we not surprised) hadnt so were bouncing back loads of class 2.  I thought it had been fixed. 

Ive just dug this from an old (2017) AW article:-

''The taxpayers liability for class 2 NIC is based on the NPS record held under his NI number, not the information reported on his SA tax returns. Entries on the SA return arent used to update the taxpayers class 2 NIC record on the NPS. So reporting the date on which the taxpayer commenced or ceased self-employment on his SA return, wont affect how HMRC calculate the taxpayers liability for class 2 NIC. HMRC must be separately informed of the start (on form CWF1) and finish for a self-employed trade''

The link for CWF1 is below for anyone needing it.

https://www.tax.service.gov.uk/shortforms/form/CWF1ST?dept-name=CWF1&sub-dep

Not sure Doug how you/client notifed in the first place.

Problem is - if you dont pay it they could have a gap. If you do pay and they are due a refund for an overpayment you will likely never get it back.

 

 



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 Joanne 

Winner of Bookkeeper of the Year 2015, 2016 & 2017 

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position
Artois


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Hi Joanne

I have just received letters from HMRC concerning these 2 clients saying

'Your Class 2 NI figure has been corrected in line with the information we hold'

Both clients are new so will speak to them on Monday to find out if they have had any issues with their Class 2 before, I know they have both been S/E for many years and been on the CIS so can not understand why there is a problem with collecting the NI.

One of the refunds are already through and the other says issued on Friday so will wait until it is paid just in case I need to speak to HMRC

Cheers for the link



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Doug

These are only my opinions of how I see things and therefore should not be taken as advice
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