Take action if you filed your 2019/20 tax return after 31 January 2021 and paid voluntary Class 2 National Insurance contributions

Self-employed people with profits below the Small Profits Threshold (£6,365 for 2019/20) do not have to pay Class 2 NICs, but may choose to do so voluntarily in order to protect their eligibility for certain state benefits.

HMRC is aware that some taxpayers will have paid voluntary Class 2 National Insurance contributions (NICs) even though they filed their 2019/20 Self Assessment tax return after 31 January 2021.

Unfortunately, HMRC’s processing rules do not allow for voluntary Class 2 NICs to be included in the Self-Assessment calculation for returns filed after 31 January. Therefore, any Class 2 NICs payment will not be linked to the tax return and will be repaid.

If you have paid voluntary Class 2 NICs via Self-Assessment, but filed your 2019/20 Self Assessment return after 31 January 2021, you should receive a customer service message when you file your return telling you it’s too late to pay voluntarily, and HMRC will refund the voluntary Class 2 NICs payment. 

If this situation arises, contact HMRC on the National Insurance Helpline 0300 200 3500 and explain that you want the Class 2 NICs payment to be linked to your 2019/20 tax return. You can also check your National Insurance record using GOV.UK.

Class 2 NICs included in a Time to Pay arrangement

In a previous news article, we highlighted a different issue. This was that some self-employed people who have entered payment plans for the tax due on 31 January 2021 might want to ensure HMRC first allocate their instalments to paying Class 2 NICs. Read that article in full if you are in that situation, as payment of these contributions can protect your entitlement to some state benefits.