• Foxmain Associates

National Insurance for Company Directors

HMRC has updated the guidance in the National Insurance for Company Directors booklet (CA44) for 2021 to 2022 on how to work out NIC payments for Directors.


Directors have to use an annual (or pro rata annual) earnings period to work out their liability for Class 1 NICs. This figure has to include all director's earnings when working out NICs, including fees and bonuses.


Directors are classed as employees and pay National Insurance on annual income from salary and bonusses over £9,568.


The earnings period for the assessment of directors' NICs remains an annual one. However, subject to the qualifying conditions, directors can make payments on account of directors' NICs during the tax year based on the actual intervals of payment - usually weekly or monthly - in the same was as for other employees.


Payment of a director's personal bills through an account with the company.


Directors who have an account with their company may arrange for the company to settle their personal bills and then charge the amount to their account. If you meet a director's personal debt in this way, and then debit the amount to the account, there is liability for NICs when the: -

  • Account becomes overdrawn, or there is an increase in the amount by which it is overdrawn, and;

  • Debiting is made in anticipation of an earnings payment, for example, fees or bonuses.

NICs are due on the overdrawn amount or the increase in the overdrawn amount. You must use the NICs rates and the earnings period which apply when the account is debited.


There is no liability for NICs if the: -

  • Account becomes overdrawn, or there is an increase in the the amount by which it is overdrawn, and;

  • Debiting is made in anticipation of an introduction of funds which are not earnings, for example, dividends, matured insurance policies or other personal income.

You can find more information about paying National Insurance contributions (NICs) for Company Directors by following this link: - CA44 - National Insurance for Company Directors (publishing.service.gov.uk)

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