If an employee has an accident and their employer continues to
pay their earnings while they are off work sick, include the
earnings in gross pay for Class 1 NICs purposes.
Include any such payments in gross pay if:
If the employee must repay the employer any payments which they
receive from the employer while off work in such circumstances,
even if the claim for damages is unsuccessful, then do not include
those payments in gross pay when calculating NICs.
However, if at a later date, the employer decides to write-off these payments so that the employee no longer has to repay them, add the amount written-off to any other earnings received by the employee in the pay period in which the employer decides to write-off the payments. NICs should be assessed on the total amount received in that pay period.