Sage 50 Payroll

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New Apprentice NI category H not valid with GPP pension scheme

Posted By Beth Clayton over 8 years ago

When updating the 2016/17 NI category for Apprentices under 25, I am unable to assign the new H category to those who are enrolled in our GPP pension scheme. The error message states that the only valid categories are A,B,C M,X and Z.

There is no explanation given, can anyone help me to understand why the pension scheme has an impact?

Thank you

Steven Holden over 8 years ago

Hi Beth,

A Group Personal Pension (GPP) scheme type is not contracted out, so NI contributions are at the standard rate, with employees having NI categories A, B, C, J or X. The pension contribution is ultimately tax free, but the employee must pay tax at source which the pension provider can reclaim from the government and add to the employee's pension fund.

GPP schemes don’t receive tax relief or NICs rebates.

You can refer to Ask Sage article 34501 for full info on the changes to NI categories for apprentices and contracted out employees from 6 April 2016.

You can also refer to your pension provider and The Pensions Regulator (TPR) for further info.

Regards,

Paul

Sage GB
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Sage 50 Payroll

New Apprentice NI category H not valid with GPP pension scheme

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