Office of Public Sector Information

EXPLANATORY NOTE

(This note is not part of the Regulations)

These regulations amend the Social Security (Contributions) Regulations 2001 (“the SSCR”). The amendments form two groups: (i) amendments to the provisions concerning the recovery of earnings-related contributions, and (ii) amendments consequential upon the replacement of the penalties provisions of section 98A(4) of the Taxes Management Act 1970 (“TMA”) by Schedule 24 to the Finance Act 2007.

Regulation 1 provides for the recovery-related provisions to come into force on 6th April 2008 and the penalties consequentials to come into force on 1st April 2008. It also defines the expression “the SSCR”.

Regulation 2 introduces the amendments to the SSCR.

Regulation 3 amends regulation 67(2) of the SSCR, which introduces Schedule 4 to those Regulations. The opportunity presented by these Regulations is taken to make a minor drafting amendment.

Regulation 4 amends paragraph 15 to Schedule 4. The paragraph is amended so that, where earnings-related contributions have been unpaid for 17 days, HMRC may specify the unpaid amount of earnings-related contributions, together with other amounts of income tax, student loan deductions and construction industry deductions that the employer is required pay over to HMRC, without differentiating between each individual item. The opportunity is taken to replace references to the Inland Revenue with references to “HMRC”, here and in paragraphs 16 and 17 of Schedule 4.

Regulation 5 amends paragraph 16, which deals with recovery of earnings-related contributions or Class 1B contributions. This is to enable HMRC to take proceedings to recover unpaid earnings-related contributions where the contributions comprise the whole or part of a combined amount that has been specified under paragraph 15 without the need to identify each individual item.

Regulation 6 amends paragraph 17, which deals with interest on overdue earnings-related contributions. The power that HMRC has to prepare a certificate evidencing the amount of unpaid interest is extended so that the outstanding interest on any element of a combined amount can be set out in one certificate without the need to identify each item.

Regulation 7 makes amendments to paragraphs 22 and 31 of Schedule 4 to the principal Regulations to reflect the replacement of section 98A(4) of TMA.

An impact assessment has not been prepared in respect of this instrument as no impact on the private or voluntary sectors is foreseen.