Incorrect NI amounts deducted

layanna_jade

Hi

Not sure if this is the right place to be posting this so please feel free to move it if needed.

My housemate had an email from the payroll department of the company he works for (tis a government agency) saying that due to an error that they had made, they hadn't deducted enough NI from his salary since he started in Apr 2008.

Apparently they've only been deducting 9.5% rather than 11% so he now apparently owes £580 that they originally were going to deduct from this month's salary (paid next week). He's managed to get them to stall taking anything off his salary until february but can anyone give advice in this situation please?

Thanks

karenx

He can chose not to pay it but then if he needs to claim JSA etc I would then imagine he wont have the right contribitions.

stazi

I think that the E/R can only recover any underpaid NIC in this current tax year. Any underpayment in an earlier tax year may be up to the E/R to pay. Contact HMRC NIC office for more advice, or on the HMRC website.

chrisbur

They are allowed to deduct extra NI to recover the underdeduction if the error was made "in good faith" whatever that means. Deductions can only be made in the tax year that the mistake was made in and can be no more each pay day than the employee has to pay in NI, ie they can take double payments. Any money that cannot be collected has to be paid by the employer.
Details on page 17
http://www.hmrc.gov.uk/guidance/cwg2.pdf

layanna_jade

Thanks for the advice everyone. I'm getting him to contact the hrmc directly tomorrow now that he's armed with the correct information