Manage an employee's tax and national insurance (NI)

Available for the following plans: Employment Lite, Employment Plus, Employment Unlimited
Available for the following HR classic plans: Standard, Premium, Platinum
Available for the following Payroll classic plans: Essentials, Standard, Premium
Available for the following user access levels: Admin

National Insurance, which is often abbreviated to NI (or NIC, National Insurance Contribution or NINO), is money that is paid to His Majesty's Revenue and Customs (HMRC) by employers, employees, and those who are self-employed. It remains a Government Scheme and anyone working in the UK earning over a set threshold must pay into the scheme.

The Tax and National Insurance feature within the Employee File module changes depending on whether you have a connection to one of our payroll offerings or you have an HR classic platform. If you have no connection to a payroll classic platform, then you can use this feature to edit your employees' tax and national insurance details. 

If you have connected Employment Hero to a payroll classic platform, the Tax and NI page is read-only with the details stored and managed via your payroll classic platform. An administrator or the employee must complete this screen during onboarding to make sure the first sync to payroll occurs and then the screen will become read-only thereafter. 

Daily activities

  Select the payroll classic platform you integrated with for the relevant instructions. If you do not have an integrated payroll classic product, click the HR classic tab.

HR classic EH Payroll classic Xero
Update tax and NI details
  1. Click the   People menu.
  2. Click the Employees List submenu.
  3. Select the employee that needs their details updated.
  4. Click the Tax and NI Details tab.
  5. Complete the following fields in the Tax and NI Details section:
    • Do you have a P45 form?
    • Employee statement.
    • This employee has previously been reported
    • Tax code:
      • Use W1/M1.
    • Has a student loan:
      • Student loan type:
        • Plan 1.
        • Plan 2.
    • Has post grad load.
  6. Complete the following fields in the National Insurance Details section:
    • National insurance number (NINO).
    • National insurance category:
      • Category A - Standard rate (most employees).
      • Category B - Reduced rate (females only, married/widows).
      • Category C - Pensioners (employees over state pension age).
      • Category H - Apprenticeships for U25.
      • Category J - Deferred rate (employee has another job).
      • Category M - Standard rate for U21.
      • Category Z - Deferred rate for U21 (Employee has another job).
    • Company directory.
  7. Complete the following fields in the previous Employer (P45) section:
    • Employee PAYE reference:
      • Office number.
      • Reference number.
    • Leave date.
    • Student loan deduction to continue.
    • Tax code at leaving date:
      • W1/M1.
    • Last entries on the P11 deductions working sheet.
    • Total pay date.
    • Total pay to date.
  8. Click the Save button.

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