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June 28, 2022
Question

How do I stop the employers NI contributions being calculated - I have put the employment allowance as "ON" - do I need small employers relief too?

  • June 28, 2022
  • 2 replies
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2 replies

MariaSoledadG
June 28, 2022

Let me guide you on how to stop employers National Insurance contribution from being calculated, westhillfarm.

 

The National Insurance contributions are a tax on earnings and self-employed profits paid by employees, employers and the self-employed. This help build your entitlement to certain benefits depending whether you are employed or self-employed, such as the State Pension and Maternity Allowance.

 

Normally, the system will only calculate contributions and deductions depending on how they are set up in the account. You can tick the Exempt from National Insurance option so NI won't be  calculated. To do this, follow the steps below:

  1. Start by going to Payroll settings.
  2. Now select Pay Categories, and then Add.
  3. Leave PAYE Exempt and Exempt from National Insurance checked to ensure PAYE and NI are calculated.
  4. Click Save.
  5. Go back to your list of Employees and select a furloughed employee.
  6. Go to Pay rates.
  7. Select your newly created category and tick the Show in Pay Run box.

 

Furthermore, to make sure that you'll be able to monitor sales and expenses, you can run reports and customise them so you'll get the data you need. To give your more details, here's an article so you'll be guided: Customise Reports In QuickBooks Online.

 

Let me know if you have any concerns about employees and employers contributions. The Community is always right here to address all your needs. 

November 27, 2023

I am a self-employed  Sole Trader Exempt from NC2 payments because I am over 65. I have said on the Tax profile I am exempt but it still show that I am paying NI contributions. The funny thing is though that it is not showing up for this current 23-24 year. How can I correct this?

November 27, 2023

Hi Staurt, thanks for joining this thread - are you using QuickBooks Online or QuickBooks Self-Employed and did you turn 65 within the current or previous tax year? 

June 28, 2022

Hi, thanks for the help but is this only available in Advanced Quickbooks?  We have standard payroll only and 1 employee.  It is the business employer contributions that we need to stop, not the employee side.  Any more help available?

June 28, 2022

Hi westhillfarm, the NI contributions will still be calculated when employment allowance is enabled, and will be reduced by the EA on the p32 report to show the net NIC due for that period. If you do not believe that the calculations are showing correctly here, please get back to us below.