NI - does it get refunded at end of year if you pay too much one month?

[psychocandy]

Having a mental block with this. Im sure my accountant has told me this in the past but I aint asking him again or he'll tell me to sod off! :-)

Now I know, if you pay a larger salary one month then sometimes tax can be payable. But this all gets sorted at tax return time.

NI I can't remember. If you pay NI one month is it then gone, or does this work the same?

[Kenny@MyAccountantFriend]

Will depend if you are a director ni works differently to an employee.
NI for a director is only paid when annual thresholds are hit.
As an employee the tresholds are split evenly per pay periods so when you get a bonus you could pay a lot more ni as an employee than as a director.

Income tax would be the same for both and adjusted each time your paid based on earnings and tax paid in the current tax year.

[psychocandy]

Will depend if you are a director ni works differently to an employee.
NI for a director is only paid when annual thresholds are hit.
As an employee the tresholds are split evenly per pay periods so when you get a bonus you could pay a lot more ni as an employee than as a director.

Income tax would be the same for both and adjusted each time your paid based on earnings and tax paid in the current tax year.

Ah I see. So as an employee (not a director) what happens if you get a large salary one month (which attracts NI and tax) but nothing the following month?

With tax the total evens out at tax return time but is it the same with NI? Or once paid its lost?

[Kenny@MyAccountantFriend]

Ni is lost when paid as it not reclaimable on a tax return it he same was as income tax.

[psychocandy]

Ni is lost when paid as it not reclaimable on a tax return it he same was as income tax.

Right so if you pay, say £2000 one month which attracts NI, then £0 next month it doesnt balance out?

To be honest, this is my Mrs we're talking about in her own employment. They screwed her pay up but corrected it this month. Normally she doesnt pay NI but because they made such a big payment this month to fix previous cock-ups its cost in NI.

Seems a bit crap to me.

[Kenny@MyAccountantFriend]

For a director it would all balance out overal but not for a non director.

So in this example she will have ni to pay that she would not normally have paid.

[psychocandy]

For a director it would all balance out overal but not for a non director.

So in this example she will have ni to pay that she would not normally have paid.

That is a bit crap then. Employer screws up so subsequent payment costs NI so less take home. Not cool.

(EDIT - actually I was wrong about no NI - she should pay £200 in a year. Since she now paid £150 will it all cancel out now so she ends up paying £200 total?)

[WordIsBond]

Well, it will have cost them, too. But they should make her an extra payment to cover her NI cost, if it is their mistake.

[WordIsBond]

(EDIT - actually I was wrong about no NI - she should pay £200 in a year. Since she now paid £150 will it all cancel out now so she ends up paying £200 total?)

Won't help. It's calculated based on every payment independent of other payments.

[psychocandy]

Well, it will have cost them, too. But they should make her an extra payment to cover her NI cost, if it is their mistake.

This is the NHS. Getting them to pay the correct salary takes 6 weeks of hassling them.

They randomly came up with a figure for august. No idea how they got it. Their excuse after 6 weeks - computer error! OK...........................