Chronology of NICs legislation

The history of National Insurance Contributions (NICs) as it affects employment-related shares and other securities is complex and a summary is set out below:

Legislation before 7 November 1991

Legislation Description
Section 3(1) and 3(3) of Social Security Act 1975. & Reg. 19(1)(d) of Social Security (Contributions) Regulations 1979 Shares and share options derived from employment are earnings. However all were disregarded from NICs as they fall to be defined as payments in kind. Payments in kind are disregarded from earnings by virtue of regulation 19(1)(d).

Legislation which took effect from 7 November 1991

Legislation amended/inserted by the Social Security (Contributions) Amendment (No. 6) Regulations 1991 (SI 1991 No. 2505)

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