Where the intermediary is a partnership then Class 2 and Class 4
NICs may be due, in addition to any Class 1 NICs in respect of the
deemed payment.
Class 4 NICs will only be due if there are any taxable
Trading Income profits remaining after deducting the deemed
payment.
Class 2 NICs will be due even if there are no taxable
Trading Income profits.
It is important to bear in mind the maximum total Class 2
and employee’s Class 1 NICs in working out the overall
liability.
The amount of Class 1 NICs due on the deemed payment is
calculated using an annual earnings period, irrespective of the
fact that the partners are not directors. See example
ESM3232.
