To prevent manipulation of the earnings period rules to reduce contributions, directors in Class 1 have an annual earnings period, however often they may be paid (Contributions Regulations, reg. 8). In principle, no contributions become due until total earnings for the year reach the annual threshold (£9,500 for 2020-21). Both employer and employee contributions are determined by the same rules, except that the UEL is irrelevant for the employer.

Need help? Get subscribed!

To subscribe to this content, simply call 0800 231 5199

We can create a package that’s catered to your individual needs.

Or book a demo to see this product in action.