NIM18120 - Class 1B NICs : Liability : Record Keeping

Employers will not have to keep any records of payments covered by PSAs specifically for Class 1B NICs purposes. They need only keep those records which are required for tax purposes.

This means that an employer has to keep a record of any items given to the individuals. These records will normally be the same as those which the employer keeps anyway for his own accounting purposes.

If employers cannot identify which employee received a particular expenses payment or benefit (for example, which employees made use of the company’s free chiropody service) the employer need only keep a record of

• the overall cost of providing the items in question
• the number of employees who received them, and
• an indication of what rate of tax they pay.

Records must be kept for a minimum of 3 years.