NIM06195 - Class 1 NICs: Expenses and allowances: Telephone expenses: Legislation
In accordance with section 6(1) of the same Act, Class 1 NICs are payable when 鈥渆arnings are paid to or for the benefit of an earner鈥� above a certain level (the earnings threshold). See NIM02015 for further guidance on section 6(1) and NIM01008 regarding the earnings threshold.
Regulation 25 and paragraph 9 of Part VIII of Schedule 3 to the Social Security (Contributions) Regulations 2001
鈥渁ny specific and distinct payment of, or contribution towards, expenses which an employed earner actually incurs in carrying out his employment.鈥�
This serves to ensure that any actual business expenses will not be liable for Class 1 NICs.
See NIM05020 for general guidance on business expenses.
Most benefits in kind are excluded from liability for Class 1 NICs by virtue of regulation 25 and paragraph 1 of Part II of Schedule 3 to the Social Security (Contributions) Regulations 2001. From 6 April 2000, however, those benefits in kind which are excluded from Class 1 NICs will generally attract a Class 1A liability. See NIM13000 for general guidance on the principles concerning Class 1A liability.