Looking to overpay Class 1 NI by £400 in 15/16

ClarkeKent

I started work in September last year, and although paying no tax I have been paying £75 Class 1 NI contributions per month since.

For the tax year 15/16 my earnings will be around £8500. On the online tax calculators it states I should be payng around £65 NI for the whole year.

So if I continue at this rate (£75 p/m) will have to attempt to reclaim £400 NI from HMRC.

With two pay days to go before the end of the tax year, how can I avoid having to got through the hassle and possible failure of repayment? (I was refused an overpayment of Class 1 NI for £100 ish last year)

Can I ask payroll to refund some or scale back manually my contributions?

Darksparkle

NIC is calculated at each pay period, not annually like tax.

You pay 12% NIC on anything over £672 per month.

[Deleted User]

ClarkeKent wrote: »

I started work in September last year, and although paying no tax I have been paying £75 Class 1 NI contributions per month since.

For the tax year 15/16 my earnings will be around £8500. On the online tax calculators it states I should be payng around £65 NI for the whole year.

So if I continue at this rate (£75 p/m) will have to attempt to reclaim £400 NI from HMRC.

With two pay days to go before the end of the tax year, how can I avoid having to got through the hassle and possible failure of repayment? (I was refused an overpayment of Class 1 NI for £100 ish last year)

Can I ask payroll to refund some or scale back manually my contributions?

You misunderstand the system. The only way that you can reclaim any NIC is if you somehow manage to pay too much NIC at anything other than the 2% rate. Typical examples are where you have two jobs with both attracting sizeable class1 contributions or some interaction of class 1,2 and 4 contributions. It would follow that someone who earns, say, £50000 under PAYE should not be paying NIC at 12% anywhere else. Doesn't happen though - hence a claim for repayment.

ClarkeKent

Why would the online tax calculators say £52.80 for a salary £8500?

http://www.listentotaxman.com/8500?

Otherwise, if I pay over £400 as forecast. 20% of my earnings for 15/16 will go on Class 1 NI. Surely that can't be right?

agrinnall

A patanne has explained, your salary isn't £8500, it's more like £17000. If you put that into the calculator you'll see a figure much closer to what you have actually been paying.