NI rates are normally stored in a company 00 or global data file and used by all payroll companies on your payroll system.
Warning: NI rates are automatically updated as a part of the annual payroll software update but they should always be checked after the update prior to calculating the first payroll of the new Pay As You Earn year for all payroll companies to ensure the correct rates are present.
If the top of the form shows a message There is only one global NI rate file therefore it only necessary to check the NI rates in a single payroll company then you only need to check the parameters in the one payroll company.
If the top of the form shows a message similar to Payroll companies 00 and 02 NI rate files therefore you should check the NI rates parameters for each of these companies following annual upgrades then you should check the parameters in one of the companies other than a non 00 company listed, that is, not company 02 in this example and also in the non company/companies listed - company 02 in this example.
If the top of the form shows a message similar to There are more than 100 payroll companies with NI rate files therefore you should check the NI rate parameters for ALL companies following annual upgrades then you should check as advised all payroll companies.
If the top of the form also shows a message It is recommended that you contact software support to review your system then you should contact your accounts software support team since the parameters found are not as expected.
To access the NI rates
The Payroll Password form is displayed.
Enter your payroll password.
The PAYROLL menu is displayed.
Select the System maintenance option.
The PR SYSTEM MAINTENANCE menu is displayed.
Select the NI rates option.
The NI rates form is displayed.
NI rates form
The NI rates form is displayed when you select the NI rates option from the PR SYSTEM MAINTENANCE menu.
What do you want to do or be advised about?
Maintenance of the NI rates
The NI rates record consists of three TABs called N.I. Rates, Validation and Audit. The Validation TAB is only shown if you have logged in as a software supplier login.
To create a NI rate record first click the Create button and then enter the N.I. Code and other details followed by clicking the Create button. To amend a NI rate record enter the N.I. Code and click the Amend button, make the amendments and click the Save button to save the changes.
N.I. Rates Tab
N.I. Code: The one character code.
Tip : Click the Ellipsis button
to search for a N.I. code from the N.I. rates file.
Description: The thirty character description.
Type: A one character type field used in the calculation process.
I: In or Not Contracted Out
i: In at a reduced rate or Not Contracted Out at a reduced rate
X: Exempt
O: Contracted out
o: Contracted out at a reduced rate
Code for P14: The NI code reported on a P14 record and printed on a P60 record. For example, N.I Code a will be shown on a P14 as Code A.
Employer Rebate %: The percentage at which the employer's NI rebate is calculated based on the earnings between the Lower Earnings Limit, (LEL) and the Employer Annual threshold (ET).
Employer Annual threshold: The point at which an employer will start to pay NI and is the cap point for NI Employer Rebate calculations.
Employee Rebate %: The percentage at which the employee's NI rebate is calculated based on the earnings between the Lower Earnings Limit, (LEL) and the Employee Annual threshold (ET).
Employee Annual threshold: The point at which an employee will start to pay NI and is the cap point for NI Employee Rebate calculations.
Breaks and Contributions table
A grid consisting of up to ten different break points and contribution percentages is present on each N.I. Code record
Weekly Breaks: The threshold for applying the percentage contributions when adjusted to take into account the payroll type and the number of tax periods per payroll period. The first weekly break point is known as the Lower Earnings Limit or LEL. The second and third break points are known as the Employee and Employer Earnings Thresholds or ET. The Earnings threshold break points 2 and 3 are however only shown for reference, their use within the calculation process is always based on the Employer Annual threshold and Employee Annual threshold fields instead. Break point 4 is known as the Upper Earnings Limit or UEL.
On LEL Employee: This field is currently not used, previously a lower percentage contribution was taken for the first earnings band.
Contracted in employee: The percentage employee contribution for I or i type N.I. Codes.
Contracted in employer: The percentage employer contribution for I or i type N.I. Codes.
Contracted out employee: The percentage employee contribution for O or o type N.I. Codes.
Contracted out employer: The percentage employer contribution for O or o type N.I. Codes.
Example
For the 2006-2007 PAYE year on N.I. Code A. A weekly paid non director employee will pay 11% contributions on earnings subject to National Insurance between 97 and 645 pounds and an additional 1% contributions on all earnings above 645 pounds.
What do you want to do?
Validation Tab
The Validation form is displayed when you select the Validation Tab from the N.I. rates form.
The validation fields are all used as a part of the payroll year end internet submission process. If any of the validation rules fail during the submission process the details are printed on an error report and the P14/P35 data is not transmitted.
The following fields are displayed on the Validation Tab. All of these fields are self-explanatory and thus no explanation is supplied.
At LEL zero
At LEL not zero if LEL to ET not zero
At LEL not zero if earnings exceed LEL
LEL to ET zero
At LEL not zero if ET to UEL not zero
ET to UEL zero
ET to UEL zero not zero if total contributions exceeds 32p
ET to UEL zero not zero if employee contribution exceeds 16p
Zero NI contribution expected
Total contribution equal to or exceeds employee contribution
Total contribution equal to or exceeds zero
Employee contribution zero
Employee contribution not zero if ET to UEL not zero
SCON number required
Invalid for male employee
ECON number required
COMP required
What do you want to do?
Audit Tab
The Audit form is displayed when you select the Audit Tab from the N.I. rates form.
The audit data TAB is system maintained and may be used to check when and by who a N.I. Rate record has been amended.
The following fields are displayed on the Audit Tab. All of these fields are self-explanatory and thus no explanation is supplied.
Date last edit
Time last edit
Last edit by
Terminal last edit
What do you want to do?
PUSH BUTTONS:
Exit: Returns you to the PR SYSTEM MAINTENANCE menu.
Help: Displays help on the current application in your default company browser.
Create: Click the Create button before entering the N.I. Code or any other details if creating a new N.I. Code record.
Amend: Click the Amend button after entering a N.I. Code if wanting to amend the N.I. Code for the current payroll company.
Save: Saves any changes that you have made to the N.I. Code form.
Cancel: Cancels any changes that you have made to the N.I. Code form and returns you to the PR SYSTEM MAINTENANCE menu.
Reporting of National Insurance
National Insurance may be reported from the following places:-
The Payroll, Reports & enquiries, Period reports menu option called Period NI totals
The Payroll, Reports & enquiries, Period reports menu option called Cumulative NI totals
The Payroll, Reports & enquiries, Year-end reports menu option called P35 listing
What do you want to do?
