The Social Security (Contributions) Regulations 2001

Prescribed equivalents U.K.

11.—(1) The prescribed equivalents of the lower and upper earnings limits and the primary and secondary thresholds, for the purposes of—

(a) sections 6(1), 6A(1), 8(1), and 9(1) of the Act (which provide liability for Class 1 contributions, notional payment of primary Class 1 contribution where earnings are not less than the lower earnings limit, the calculation of primary Class 1 contributions and the calculation of secondary Class 1 contributions respectively)F1 ; and

(b) sections 41(1) and 42A(1) of the Pensions Act (reduced rates of Class 1 contributions and rebatesF2 ,

shall be determined in accordance with paragraphs (2) to (5).

(2) Subject to paragraphs (4) and (5), the prescribed equivalents of the lower and upper earnings limits shall be—

(a) where the earnings period is a multiple of a week, the amounts calculated by multiplying the lower and upper earnings limits (“the weekly limits”) by the corresponding multiple;

(b) where the earnings period is a month, the amounts calculated by multiplying each of the weekly limits by 4 1/3;

(c) where the earnings period is a multiple of a month, the amounts calculated by multiplying each of the weekly limits by 4 1/3 and multiplying each result by the corresponding multiple;

(d) in any other case, the amounts calculated by dividing each of the weekly limits by 7 and multiplying each result by the number of days in the earnings period concerned.

(3) Subject to paragraphs (4) and (5), the prescribed equivalents of the primary and secondary thresholds shall be—

(a) where the earnings period is a month, [F3 £453];

(b) where the earnings period is a year, [F4 £5,435];

(c) where the earnings period is a multiple of a week, the amount calculated by dividing the figure in sub-paragraph (b) by 52 and multiplying the result by the corresponding multiple;

(d) where the earnings period is a multiple of a month, the amount calculated by dividing the figure in sub-paragraph (b) by 12 and multiplying the result by the corresponding multiple;

(e) in any other case, the amount calculated by dividing the figure in sub-paragraph (b) by 365 and multiplying the result by the number of days in the earnings period concerned.

(4) The amounts determined in accordance with paragraph (2)(b) and (c) and paragraph (3)(c) and (d) if not whole pounds, shall be rounded up to the next whole pound.

(5) The amounts determined in accordance with paragraph (2)(d) and paragraph (3)(e) shall be calculated to the nearest penny, and any amount of a halfpenny or less shall be disregarded.

Textual Amendments

F1 Sections 6, 8 and 9 were substituted, and section 6A inserted, by paragraphs 2 to 5 of Part I of Schedule 9 to the Welfare Reform Act.

F2 Section 41(1) was substituted by paragraph 127 of Schedule 7 to the Social Security Act 1998 and amended by paragraph 6(2) of Part II of Schedule 9 to the Welfare Reform Act. Section 42A was inserted by section 137(5) of the Pensions Act 1995 (c. 26). Subsection (1) of section 42A was substituted by paragraph 128 of Schedule 7 to the Social Security Act 1998 and amended by paragraph 7(2) of Part II of Schedule 9 to the Welfare Reform Act.

F3 Word in reg. 11(3)(a) substituted (6.4.2008) by The Social Security (Contributions) (Amendment) Regulations 2008 (S.I. 2008/133), regs. 1(2), 4(a)

F4 Word in reg. 11(3)(b) substituted (6.4.2008) by The Social Security (Contributions) (Amendment) Regulations 2008 (S.I. 2008/133), regs. 1(2), 4(b)