To Adjust an Employee's National Insurance

  1. Open the Payroll folder and then click Utilities or click the Payroll & HR tab on the Ribbon Bar and then click Payroll - Utilities.

  2. Click Adjust NI.

  3. If you are using groups, in the Select Payroll Groups list, click to select the group(s) you want to process and then click OK.

  4. In Employee Ref, type the employee reference or select from the list to identify the individual whose NI values are to be amended. The application will display the history records for the current tax year.

  5. Click to select the pay period for which the change of NI Code is to be effective.

  6. In the NI Code box, enter the new NI Code to apply to that period.

  7. Press the Tab or Enter button. The application then checks that the change is valid before calculating and displaying the adjusted NI values. If you are asked whether you want the NI adjustment to apply to all subsequent periods in the tax year, reply 'Yes' or 'No' as appropriate.

    - If you click 'Yes', the employer's and employee's NI values - displayed in the EE NI and ER NI columns - will be recalculated from the chosen pay period to the last pay period in the current tax year. For example, if period 12 is the current pay period and you adjust an employee's NI for period 9, periods 9, 10, 11 and 12 are recalculated on this form.

    - If you click 'No', the employer's and employee's NI values will be recalculated for the chosen pay period only.

    Depending on the NI code selected other messages may also be displayed.

  8. Click OK and then click OK again to confirm the changes.

Note: If you change an employee to NI letter C (employees of retirement age), or to NI letter X (employees under 16), the application uses the employee's Date of Birth and the Usual Pay Date for the relevant period to check whether the employee is the correct age.

There are only three circumstances when category letter X can be used:

- for employees paid below the Lower Earnings Limit for every pay period (for example, employees who are under 16 years old).
- for pension-only schemes
- for workers from abroad.

  1. Run the Calculation command to update the employee's record with the recalculated NI. The Calculation report will display a note to the effect that the employee's NI has been adjusted and the Employee Record Print displays the value of the adjustment. The adjusted NI value is also displayed on the Payroll - Processing - History form for the current pay period's record. The previous pay periods still reflect the deductions that were made in those periods so you can see the actual deductions made from the employee's pay.