Service of Taxes
National Insurance Contributions (NIC) are contributions paid by certain individuals out of their earnings. This tax charge unlike others is paid in order to ensure an individuals’ entitlement to certain state benefits.
The employer is also liable for NIC and the amount is calculated and deducted through PAYE, recorded on the Full Payment Submission (FPS) and paid to HM Revenue and Customs HRMCSend Enquiry
State benefits that depend on National Insurance contributions:
State benefits that are linked to NIC are known as ‘contributory benefits’.
NIC count towards the following state benefits:
State benefits not linked to NIC:
In certain cases a person is granted credit that are used towards covering contributions that could otherwise have not been made by the individual as they were unable to work.
These can protect a person’s privilege to certain benefits: