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Readers’ forum: Concern as NICs are not charged on profits

24 June 2024
Issue: 4942 / Categories: Forum & Feedback , Investments
Blame the computer

I’ve seen some suggestions online recently that class IV NICs are not due on transition profits. I am sure that that is not correct but what caused me some concern was that apparently some software is not applying NICs to those profits. First of all can readers confirm my understanding that NICs are due?

Then the more interesting part – if there is a software problem where does responsibility lie if a client is penalised for an incorrect return? There do seem to be several problems emerging with the way that at least some software is dealing with the changes to the basis period rules.

Query 20 344 – Trusting.

Are transition profits charged to class 4 contributions?

Trusting is absolutely correct that class 4 National Insurance contributions (NICs) are due on transition profits arising due to basis period reform. However this isn’t immediately obvious...

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