Chapter 11 - Class 1A and 1B

Question 1

1A and 1B

Answer 1

Paid by employers only. Class 1A is paid on cash equivalent of certain benefits at 13.8%, Due in one sum on the 22nd July electronically or the 19th if not.

Class 1B is paid on earnings which are included in a PSA at 13.8%. Due annually on the 22 Oct following th tax year electronically or 19th if not.

Question 2

Class 1A

Answer 2

Paid on cash equivalent of taxable benefits like company cars and fuel, living accommodation and beneficial loans. There is no Class 1A if there is no associated income tax liability ie benefits that already attracted Class 1 Secondary.

Question 3

Class 1B

Answer 3

PSA benefits. This is for minor or irregular benefits and expense payments. Charged on grossed up value:
Earnings within PSA
Add back income tax payable
Class 1B @ 13.8%

Question 4

Interest and Penalties

Answer 4

Interest runs from due date to payment. Penalty of 5% if more than 30 days late. Another 5% if more than 5 months after first penalty. Another 5% is more than 11 months after first penalty
If P11D is late, a £100 per month late filing penalty applies