Centralised refunds action by NICO Refunds Group means that
Local Services have little contact with refunds work.
From 6 April 2003 NIRS 2 will continue to inform Refunds
Group of:
This automated process is still subject to a deminimis level of
half the relevant year’s Lower Earnings Limit
Although the introduction of an uncapped primary Class 1
liability on all earnings above the Upper Earnings Limit means that
each contributor will have an individual maximum based on the level
of their earnings, it will continue to be possible for a person to
pay in excess of their prescribed maximum.
This is because where a person fails to apply for deferment -
see NIM11800 - they will pay Class 1 NICs:
Where this occurs, NIRS will continue to identify excess
payments and refer cases to NICO Refunds Group who will take any
necessary action to invite a claim and refund the excess payment.
At present regulation 52, SS(C)R 2001, which provides for the
repayment of excess contributions, requires their return in a
strict order of priority. This priority order ensures that
contributions payable to the person’s chosen pension scheme
are protected.
As a result of the new maximum arrangements, amendments will
be needed to the priority order within regulation 52 to reflect
that a 1% liability will be due on all earnings in excess of 53 x
the UEL - PT.
Since the first excess refunds in respect of the 2003/2004
tax year will not be made until after 6 April 2004, regulation 52
will remain unamended until nearer the time. This will enable the
refunding of excess payments in respect of the 2002/2003 to
continue under the present wording of regulation 52.
Any enquiries about potential refunds should be referred to
Refunds Group, NICO.
