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Isak is an employee of Dibbit Ltd, and is paid an annual salary of £50,000. He makes
contributions of £3,000 into the company’s occupational pension scheme each year.In the tax year 2021/22 he drove 12,000 business miles in his own car for which he was paid 50p per mile by Dibbit Ltd.
How much employer’s class 1 NICs is Dibbit Ltd required to pay in respect of Isak for the tax year 2021/22?
Answer from Kaplan EK: 5763
Hi tax tutor, can you help explain the above answer as I got 5818 by calculating the excess mileage allowance as 1000 (12000@50p – 10000@45p – 2000@25p). The kit calculates it at 600 (12000x(50p-45p)). It’s Q60 in the Kaplan kit.
The answer in the kit is correct – the 10,000 mile cut off that applies in computing the taxable benefit for employment income does not apply for NIC purposes.
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