NIC for Directors / Employees

[Bluebird]

I'm currently working out my payroll schedule for 2008/09, on the last one that was "knocked up" for me by my accountant, they deferred paying any NI until about half way through the year.

1. Is there any benifit in this ? - I presume so but what is it ?
2. Id there a "threshold" that needs to be reached before NI applies ? - look at his figures it looks about £4700

Cheers

[Bumfluff]

Like your Avator Lucy Pinder mmmmm

[Sockpuppet]

It is becuase Directors NI is calculated on a cumulative basis not like normal employees.

This is to stop Directors saving NI by paying loads in one period as the NI rate drops over a certain figure to feck all. So you only start paying NI over about £5k ish but you pay more so it balances out.

As long as your pay is the same you can do it either way. If you pay yourself a lot in one go then you need to do Directors NIC as this is the way HMRC will calculate it.

[Nixon Williams]

I'm currently working out my payroll schedule for 2008/09, on the last one that was "knocked up" for me by my accountant, they deferred paying any NI until about half way through the year.

1. Is there any benifit in this ? - I presume so but what is it ?
2. Id there a "threshold" that needs to be reached before NI applies ? - look at his figures it looks about £4700

Cheers

On a full year, no NIC is paid by the director until the salary exceeds £5225 (2007/08). If the director was appointed part way through the year, the £5225 is applied on a pro rata basis.

Alan

[fadanoid]

Like your Avator Lucy Pinder mmmmm

Bumfluff

Who is the babe on your avatar?