Calculate Class 1A NIC for cars and fuel

Class 1A NIC is the national insurance that an employer pays on expenses and benefits in kind provided to their employees. This includes company cars, medical insurance schemes, business travel, and much more.

You can use Sage 50 Payroll to calculate the Class 1A NIC arising on company cars and fuel. However Class 1A NICs are not payable through the payroll system.

The following rules apply:

Class 1A NI is payable one year in arrears.
After the end of each tax year, you must complete forms P11D and P11D(b) Employer's Declaration. These forms report to HMRC about all the expenses and benefits provided to their employees.

Important dates

Forms P11D and P11D(b) Employer's Declaration must be submitted to HMRC by 6 July each year, for the previous tax year.
HMRC must receive Class 1A NI payments by 19 July each year, for the previous tax year.
You must pay your payment of Class 1A NI on expenses and benefits arising during the 2019/2020 tax year by 19 July 2020.

Create and maintain car records

For information on creating new car records, or maintaining existing car records, read more

View your Class 1A calculated figures

Select the relevant employee, click Employee then click Employee Record.
Under the Cars/Fuel tab, click Class 1A NIC and ensure that the car details shown on the Cars/Fuel window relate to the relevant car.

The calculation is as follows:

Charge Type	This shows Cars and Fuel, depending on the Class 1A charge type.
Standard Charges	These appear automatically and are based on the initial scale charges appropriate for the vehicle type and engine capacity. Cars The Standard Charges value is calculated as follows: (Total cost - capital contribution) x % determined by the car's CO2 emissions To view the percentages applied, click Company, click Legislation, click Car Details then click Rates. Fuel The Fuel Standard Charges only appear if the Fuel Provided check box is selected. The Standard Charges value is calculated as follows: Company Car Fuel Rate x % determined by the car's CO2 emissions. To view the Company Car Fuel Rate, click Company, click Legislation then click Car Details.
Other Days Unavailable	If the car isn't available to the employee for more than 30 consecutive days between the first and last used dates, enter the number of unavailable days in this box.
Reimbursed by Employee	Enter the amount of contribution made by the employee for either the use of the car, the fuel, or both.
Revised Charges	If you make entries in either the Other Days Unavailable or Reimbursed by Employee boxes, revised scale charges appear here. This column also takes into account the Date First Used and Date Last Used to time-apportion the Standard Charges. For example, the Standard Charge is proportionately reduced for the time in the relevant tax year that the employee did not have use of the car if: The Date First Used is after 06 April. The Date Last Used is before 05 April.
Class 1A NIC	This shows the Class 1A NIC liability for this car record which is calculated as follows: Revised Charge x Employer's Class 1A NIC rate.
Total	This shows the total of the Class 1A NIC due on cars and fuel.
Employer's Class 1A NIC	This shows the current legislation value for the employer's NIC rate.

To save your amendments and the refreshed Class 1A NI calculations, click OK, click Save then click Close.

Print the Class 1A - Cars & Fuel report

Select the required employees then click Reports.
In the Cars & Fuel folder, select Class 1A - Cars & Fuel report.
Click Print, ensure your printer details are correct then click OK.
Close the Reports window.

You should use the information provided on this report to complete forms P9D and P11D, and to make the necessary payments to HMRC.