Directors NI

Question asked by J Rogers 10 years ago

I am aware of the cumulative nature of directors NI but i can't work out why, when a director leaves at the end of June, his month 3 pay should have more employees NI deducted as the cumulative method should mean less. I operated his pay on the alternative method so that his NI was flattened out through the year and knew this would change in month 3 when he left but I would expect a small drop rather than an increase. His gross pay has been £6,500 pm. I need to be able to epxlain it to him but I can't explain it to myself!

2 Replies

Hi - just a thought:

The annual NI free pay is £8K, so, at £6.5K pm, month 1 should have been free of NI, then month 2, 1.5K is free (thus using up the £8K) leaving £5K to suffer NI. Then month 3 the whole 6.5K suffers NI. Might explain it?

Hi - just a thought:

The annual NI free pay is £8K, so, at £6.5K pm, month 1 should have been free of NI, then month 2, 1.5K is free (thus using up the £8K) leaving £5K to suffer NI. Then month 3 the whole 6.5K suffers NI. Might explain it?

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