– a clearer view of Inland Revenue’s officers’ powers to inspect employer records;

– a simpler system for calculating NICs on payments to UK employees seconded abroad;

– a common basis of “pay” for tax and NICs, except where the law provides otherwise;

– a simpler procedure for dealing with arrears of NICs;

– more time to deal with irregular payments of earnings.

Commenting on these proposals, the Paymaster General Dawn Primarolo said:

“We are committed to making the tax and NICs systems as straightforward as possible for employers to administer. The proposals the Inland Revenue has announced today are a significant step towards that end.”

Copies of the discussion paper “Simplifying national insurance contributions for employers – A technical discussion paper” are available on the IR website at or from Shaista Razaq by telephoning 020 7438 7457.

Comments on the proposals from employers and their representatives should be sent by 30 August 2000 to:

Personal Tax Division
Room 69, New Wing,
Somerset House
London WC2R 1LB


The Chancellor announced in his Pre-Budget Report that the Inland Revenue would work with employers’ representatives and others on reducing technical differences between tax and national insurance contributions (NICs). This consultation paper was foreshadowed at Budget time. It sets out areas where there are difficulties around the tax and NICs rules.

The proposals in this paper are intended to address some priority areas of concern that have been raised by employers, tax professionals and their representatives. Some of the proposals aim to provide more consistent powers for Inland Revenue employer compliance officers acting for different purposes; others aim to reduce the costs of complying with current NICs rules. The proposals in this paper will be broadly deregulatory and we would welcome comments on where the proposals will reduce employers’ costs of operating the NICs system.

Related reading