Voiding of NICs Agreements and Elections
9.Currently, employers and employees can jointly agree or elect to transfer any future potential secondary NICs liability, due on certain employment income from shares and securities acquired by employees, from the employer to the employee. These provisions are found in paragraphs 3A(2)-(4) (agreements) and 3B of Schedule 1 (joint elections) to the CBA 1992. This facility was introduced on 28 July 2000 by the Child Support, Pensions and Social Security Act 2000, to help employers deal with the problem of their unpredictable future NICs costs due on gains from share options. Amendments made by the National Insurance Contributions and Statutory Payments Act 2004 extended this facility to include employment income derived from restricted securities and convertible securities.
10.Section 5 ensures that Joint NICs Agreements and Elections can only be used for their intended purpose and specifically prevents the use of these agreements and elections by employers who seek to recover from their employees any NICs liability that may be imposed retrospectively under the powers introduced by this Act.
