National Insurance payments

jim1979

Not sure if this is the right forum but don't know where else to put this. Every week i pick up the same money, pay the same tax and national insurance contributions. Its a low paid job but i know exactly what i take home each week. A few weeks back i had 5 days holiday so i picked up 2 weeks money that week and no pay the following week. However, when i looked at my pay, instead of taking home double what i normally take home, i ended up earning about 12 pounds less. When i looked at my contributions, i had paid treble national insurance. Is this right? The way i see it, if i was paid weekly as normal i wouldn't have paid an extra week national insurance. Please help as this has happened to others at the company but the wages office keep saying this is normal. Is it?

MrsBartolozzi

I don't remember the exact figures but you don't pay NI on the first £95ish you earn each week. Then you pay 11% on the rest (55p). If you usually earn £100 a week you will only pay NI on £5, but if you get £200 (ie 2 weeks money in 1 week) you pay NI at 11% on £105 (£11.55).
Does that make sense?
These figures are only approximate but the principle is the same. You get a free amount each week that you don't pay NI on, but it's only counted once. If your company make a mistake, maybe paying you several weeks in one go, which means you pay too much NI then you have to take it up with them as their mistake left you out of pocket.

chrisbur

jim1979 wrote: »

Not sure if this is the right forum but don't know where else to put this. Every week i pick up the same money, pay the same tax and national insurance contributions. Its a low paid job but i know exactly what i take home each week. A few weeks back i had 5 days holiday so i picked up 2 weeks money that week and no pay the following week. However, when i looked at my pay, instead of taking home double what i normally take home, i ended up earning about 12 pounds less. When i looked at my contributions, i had paid treble national insurance. Is this right? The way i see it, if i was paid weekly as normal i wouldn't have paid an extra week national insurance. Please help as this has happened to others at the company but the wages office keep saying this is normal. Is it?

No this is not normal, your wages office are calculating your wages wrongly. They need to refer to their copy of
CWG2(2010)
Employer Further
Guide to PAYE and NICs

Instructions for working out tax and NI on holiday pay paid in advance are on page 29 of this guide. I have quoted the main parts below but further guidance and examples of how to do it are given in the guide.

Tax
"....if the effect of the holiday pay is that the

employee gets two or more weeks’ pay in one week
and no pay in the following week(s) then, unless
week 53 is involved, work out and record PAYE in
the last pay week for which the employee gets no

pay, or the last day in the tax year if this is earlier."

NI

"Method A
Split the sum up and work out NICs on the payment

for each week separately.

Method B
Work out NICs on the whole sum based on the
number of weeks it represents. Round up parts of

a week."

As you are paid the same each week it does not matter which method is used for NI on your wages, it will give the same answer, which will be the same as two normal weeks of NI.