Jurisdiction(s):
United Kingdom

Key definition

National Insurance Contributions definition

What does National Insurance Contributions mean? National Insurance contributions (NICs) are payments made by employees, employers and the self-employed to HMRC—or credited—so individuals build entitlement to the UK State Pension and other contributory social security benefits. NICs are a statutory concept defined primarily in the Social Security Contributions and Benefits Act 1992 (and the Northern Ireland 1992 Act) and related regulations. NICs are distinct from income tax but are usually calculated and reported via PAYE or self assessment. Amounts collected are paid into the National Insurance fund (Great Britain) or the Northern Ireland National Insurance Fund and finance the new State Pension, contributory Employment and Support...

Client letter template: UK employment tax, NICs, VAT and corporation tax rules on staff entertainment and gifts to employees and directors (P11D, PSA, trivial benefits, vouchers, long-service awards)

Published by a LexisNexis Tax expert

Precedents

[ Insert client’s address ]

1 Purpose of this letter

This letter sets out how income tax and National insurance contributions (NICs) apply when staff entertainment (for example, parties) and gifts are provided, and the implications for both employees and the employer. For the purposes of this letter, references to employees also include directors and other Office holders, eg the Company secretary, of the employing company.

2 Staff entertainment—income tax and NICs treatment

Offering a party or staff event to employees will ordinarily create a taxable benefit for each individual, subject to income tax and Class 1A NICs. The benefit must be reported on the P11D, or covered by a PAYE Settlement Agreement (PSA) if one is in place with HMRC. A PSA is used where the employer agrees to settle any income tax and the associated Class 1A NICs arising on the provision of minor or irregular benefits on behalf of its employees, with the employer instead paying Class 1B NICs under the PSA. This position does not apply where an exemption is available. The key exemptions from tax are outlined below...

To view the latest version of this document and thousands of others like it, sign-in with LexisNexis or register for a free trial.

DOWNLOAD THIS DOCUMENT

Chris Smith

Berg Kaprow Lewis LLP

Chris leads BKL's personal tax compliance team, ensuring they provide depth of support to a broad range of clients.With over 20 years’ experience in tax, Chris is familiar with the changing nature of the tax landscape and the importance of guiding people through its complexities.As part of the personal tax team, Chris also works closely with BKL’s tax specialists – including consultancy, trusts and estates, tax investigations and business tax. This helps us to deliver expert tax advice suited to each client’s circumstances and goals.Before joining BKL in 2018, Chris was a personal tax manager at MHA MacIntyre Hudson for eight years. He has also worked for NA Associates and Smith & Williamson....

Web page updated on 27/05/2026

Popular documents

Using the Judicial College Guidelines to assess general damages in personal injury claims

When evaluating a general damages claim, the practitioner ought initially to refer to the Judicial College Guidelines (JCG)...

Tomlin orders in England and Wales: CPR guidance on drafting, confidentiality, approval, variation, enforcement, limitation, CCA issues, court-specific requirements, sample wording and precedents

This Practice Note This Practice Note reviews mechanisms used in settling litigation. A Tomlin order consists of a consent order paired with a schedule. It operates to stay proceedings on terms that have been agreed. The provisions contained in the schedule may remain confidential. This Practice Note describes the scope of confidentiality attaching to the schedule and sets out how it differs from a standard consent order. Sample wording for a Tomlin order is included, alongside links to precedents, as well as guidance on court approval. It also addresses varying, setting aside and enforcing a Tomlin order, including the considerations the court will take into account when handling applications for each. Further guidance is provided on interpreting and applying the relevant provisions of the CPR; however, some courts and divisions impose very specific requirements for both drafting and approval, and for approaching the schedule and confidentiality issues. Accordingly, you must consider the particular rules and court guide provisions in the forum where your claim is proceeding when drawing up the Tomlin order...

Precedent: Deed of Surrender of Lease with Optional Premium, Settlement and Release, Landlord, Mortgagee and Guarantor Consents, Reimbursement and HM Land Registry Provisions (England and Wales)

Date [ date ] Parties [ name of Landlord ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Landlord) [ name of Tenant ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Tenant) [ [ name of Guarantor ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] [ [ name of Mortgagee ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Mortgagee) ] Definitions Within this Deed, the terms below shall be interpreted as follows: [ Annual Rent • the annual sum reserved under the Lease; ] [ Insurance Rent • the Tenant’s share of the Landlord’s costs of insuring the Property (as set out in the Lease); ] Lease • the lease of the Property dated [ date ], entered into between (1) [ the Landlord OR [ name ...

Precedent Statutory Declaration: Standard Wording under the Statutory Declarations Act 1835

I, [ name ], of [ address ], solemnly and sincerely state that: [ Matters to be verified, set out in numbered paragraphs ] I make this solemn statement in good conscience, believing it to be true, and pursuant to the provisions of the Statutory Declarations Act 1835. DECLARED at [ details ] this [ day ] day of [ month and year ] Before me ................................................................................ [ signature of the person before whom the declaration is made ] A [ commissioner for oaths OR [ solicitor OR [ insert other qualification ] ] authorised to administer oaths ]...