National Insurance Contributions

Mr. Waterson

To ask the Chancellor of the Exchequer how many people paid voluntary national insurance contributions in each of the last 10 years. (175055)

Latest available figures from 1995-96 are shown in the following table.

National insurance class 3 contributions must normally be made before the end of the sixth tax year following the one for which they were due; but the time limit has been extended for the 1995-96 to 2001-02 tax years. Customers have up to 5 April 2010 to pay if they reach state pension age before 24 October 2004, or 5 April 2009 if they reach state pension age on or after 24 October 2004. Because of this the figures detailed are likely to increase, particularly the latest years.

In respect of tax year	Contributors (thousand)	National insurance class 3 contributions (£ million)
1995-96	322	60
1996-97	406	93
1997-98	367	92
1998-99	356	91
1999-00	335	90
2000-01	304	82
2001-02	285	78
2002-03	310	78
2003-04	276	71
2004-05	213	58
2005-06	110	39
2006-07	73	24
Note: Based on a 1 per cent. sample extracted from the National Insurance Recording System on 13 July 2007.

To ask the Chancellor of the Exchequer how many computer—generated letters were sent out by HM Revenue and Customs notifying a shortfall in national insurance contributions for the 2005-06 tax year; and how many were sent in error. (175056)

To date HM Revenue and Customs (HMRC) has sent 2.41 million letters to customers advising them of a potential shortfall in their National Insurance contributions for 2005-06. It expects to issue a further 340,000 in January 2008.

A relatively small number of letters will have been sent in error but it is not possible to determine precisely how many.

To ask the Chancellor of the Exchequer how much is payable in annual national insurance contributions by a person with gross annual earnings of (a) £12,000, (b) £24,000, (c) £50,000 and (d) £100,000 in 2007-08. (175529)

The information requested is as follows.

Earnings¹	Employee national insurance payable (£)
£12,000	745.80
£24,000	2,065.80
£50,000	3,410.64
£100,000	3,910.60
¹Assumes that earnings are paid monthly and spread evenly throughout the year and the employee is in ‘not contracted out’ employment.

To ask the Chancellor of the Exchequer what guidance his Department has provided to employers on whether employees should pay reduced national insurance contributions. (175607)

HMRC does not provide specific guidance to employers on whether their employees should pay reduced national insurance contributions. The onus is on employees to give their employers a ‘certificate of election’ form. Without this certificate the employer must deduct full rate national insurance contributions.

Employers are advised to have a procedure in place to ensure employees notify them if they lose the right to reduced rate contributions, (for instance because of divorce or they have cancelled their election). The CWG2 ‘Employer Further Guide to PAYE and NICs’

http://www.hmrc.gov.uk/guidance/cwg2.pdf

and the E13 ‘Day to Day Payroll’ guidance

http://www.hmrc.gov.uk/helpsheets/e13.pdf

provides information on what employers should do where a married women or widow is entitled to pay reduced rate contributions.

Volume 470: debated on Tuesday 8 January 2008