Demand for Class 2 NI contribution from 1988

spendaholic

I've been self-employed for a long time and have always completed my self assessment on time. I've paid any taxes due on time too and even had several refunds.

This week I received a demand for Class 2 NI Contributions from April 1988. It's only for 6 quid, but I'm confused.

During several conversations over the years with HMRC, they've always said it was way too late to buy back any missing contributions older than 6 years, plus it's due for payment *immediately*, although they've already apparently waited 37 years...

Has anyone else received similar? 

Marcon

spendaholic said:

I've been self-employed for a long time and have always completed my self assessment on time. I've paid any taxes due on time too and even had several refunds.

This week I received a demand for Class 2 NI Contributions from April 1988. It's only for 6 quid, but I'm confused.

During several conversations over the years with HMRC, they've always said it was way too late to buy back any missing contributions older than 6 years, plus it's due for payment *immediately*, although they've already apparently waited 37 years...

Has anyone else received similar? 

Were you ever covered by the Small Earnings Exception and if so, did you ever apply for a refund of overpaid NI (something which became possible for periods on and from 6 April 1988)? It looks a bit of coincidence given that the demand relates to April 1988 - unless it's for the year 1987/88 and you were incorrectly given a refund of NI relating to then?

spendaholic

Marcon said:

Were you ever covered by the Small Earnings Exception and if so, did you ever apply for a refund of overpaid NI (something which became possible for periods on and from 6 April 1988)? It looks a bit of coincidence given that the demand relates to April 1988 - unless it's for the year 1987/88 and you were incorrectly given a refund of NI relating to then?

Thanks for responding!

Yes, I was covered, but I never claimed overpaid NI. They just sent me what they reckoned they owed me, usually tax I think. 

It's for 3 April 1988 to 9 April 1988, which straddles 2 tax years.

(EDIT I thought that was the year I officially went from employed to self employed, but it was a good 18 months later.)

I remember several rule changes where first we *had* to pay monthly contributions, then they were made voluntary and we paid them at the end of the year, and then they deducted them from our bank accounts following self assessment.

I've spoken to one of their support techs today but she can't see anything on my SA record, so I have to call them on Monday. 

It just seemed a bit odd, when I've been in constant contact with them in all that time. And we've discussed state pension and gaps, etc, too.

german_keeper

It might even be just a system generated form caused by a computer glitch or operator error when updating something else on your record.

spendaholic

german_keeper said:

It might even be just a system generated form caused by a computer glitch or operator error when updating something else on your record.

Thank you!

That's what I'm thinking now. I've done my sums and it was 1990-ish when I first went self employed. In April 1988, I was in full-time employment.

I'll ask them to check their records.

spendaholic

Spoke to HMRC this morning. They confirm the year in question is fully paid up, I was in full-time continuous PAYE employment, and that full Class 1 NI contributions were made.

But they say there's a missing week (despite confirming the year was fully paid and that I was in full-time employment) and I have to pay Class 2 NI contributions for that week.

I reminded them that, by law, I only have to pay Class 2 NI if I am self-employed, but I was not self-employed during this period. So even if my employer at the time did fail to pay my contributions, I was not liable for Class 2 NI. He then said that Class 2 NI contributions were NOT for self-employment. 

Eh? 

I continued to argue until he told me to write them a letter explaining all of this, and to send copies of any correspondence if a debt collection agency contacts me meanwhile.

Really, HMRC? For £6.55? Apparently from 37 years ago? When you have already agreed the year was fully paid up? What a waste of resources!

Sharing it here in case anyone else gets the same kind of demand, and I'll update it as things (hopefully) evolve. It's such a piddling small amount, I almost just paid it. But if everyone does that... 🤔