The chargeable expense is £3,000 (
NIM02492). The exempt amount is
calculated as follows:
E = £50
QW = 25. This is the number of qualifying weeks:
(a) for which the employee has been employed by the secondary contributor during the tax year in which in which the voucher is provided (51); and
(b) for which no other qualifying childcare voucher has been provided by the secondary contributor (in month 6, employee B is regarded as having received a voucher for 26 qualifying weeks).
So the exempt amount is £50 x 25 = £1,250.
As the chargeable expense of £3,000 is more than the
exempt amount, only £1,250 can be disregarded. So employer M
must include £1,750 in employee B’s earnings for the
purposes of calculating the amount of Class 1 NICs due.
The total amount disregarded in the calculation of employee
B’s earnings in the 2005/06 tax year is £2,550
(£1,300 in month 6; £1,250 in month 12).
For:
