Quote:
Originally Posted by handyandy
I've been a contractor for a number of years - first through my LTD in the 90's and then through an MSC until February 2007 (when the new MSC regs were sprung).
I don't know if I missed it last April/May due to all the change on change on change but in the last few weeks I'd been asking myself exactly the same question as oafc0000 - why am I paying no NIC's when I was in March?
I thought oafc0000's question had all the facts needed (though he mentioned being caught by IR35 which turned out to have no bearing on this - I'm out of IR35 by the way).
Neil's answer was clear, direct and releavant - thanks very much! I now know my take home will drop in a month or two.
By the way - the reason I even checked the take home on my pay slip was to see how much the 10% tax band going had impacted me compared to March's pay slip.
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One minor point which may be of interest.
Neil mentioned doing NI for directors on a cumulative basis - and this is the normal way. This is intended to prevent an avoidance strategy used years ago.
However, you can (or at least could) choose to pay NI even as a director on an apportionment basis. The effect of this is that you pay in a "smoother manner". Overall you will pay the same over the year, it's just a question of when.
This gives the details - skim the first few pages.
http://www.hmrc.gov.uk/nitables/ca44.pdf
Your accountants should be prepared to calculate on either basis - but I guess it will depend on what systems they have in place which method they prefer.