NIM11043 - Calculating & recording Class 1 earnings, NICs & NIC rebates for 2003/04: Completion of forms P11(2003-04) & P14(2003-04): Example 10: Contracted-out Salary Related (COSR) Scheme - earnings of £100 a week

In the example below, the weekly limits and thresholds for 2003-2004 have been used. These are:

• Lower Earnings Limit (LEL): £77.00
• Earnings (ET): £89.00
• Upper Earnings Limit (UEL): £595.00

Weekly earnings of £100.00

£100.00 - £89.00 = £11.00

Employee’s NICs due = £11.00 x 9.4% = £1.034, rounded to £1.03

£89.00 - £77.00 = £12.00

Employee’s NIC rebate due = £12.00 x 1.6% = £0.192, rounded to £0.19

Net employee’s NICs due     = £1.03 - £0.19   = £0.84

Employer’s NICs due           = £11.00 x 9.3% = £1.023, rounded to £1.02

Employer’s NIC rebate due   = £12.00 x 3.5% = £0.42

Net employer’s NICs due      = £1.02 - £0.42 = £0.60

Total NICs due                     = £0.84 + £0.60 = £1.44

Complete P11 as follows -

Assuming earnings are the same for 52 weeks, complete P14 as follows –