For an employee aged between 16 and 20 years old, you need to assign NI category M. With NI category M, employee NI is due, but employer NI isn’t. When an employee moves from category M to category A at 21 years old, employer NI is then also due. With an apprentice, you need to use NI category H (apprentice under 25). For more information, read Paying apprentices the correct national minimum wage. For other exceptions and further information, read National Insurance rates and categories. ▼Under 16's Under 16's don't pay NI until they earn over their personal allowance. If paid under the personal allowance you don't need to add them to the payroll. For more information, read Income Tax Rates and Personal Allowances. If you want to add them to your payroll, use category M. For more information, read the GOV.UK article Child employment. ▼When to update the category Your employee's age on the date you pay them determines their NI category. If the employee turns 21 before the process date, you must change the category before processing the payroll. If your employee turns 21 after your process date, you must change their category. Complete this before you process their next pay period. Sage Payroll will prompt you to do this. ▼Resolve errors When you process your pay, you’ll receive an error message: ‘Error: NI Category 'M' isn’t valid for employees over 21'. You must correct this before you can proceed.’ To resolve the error message, complete the following steps: - Select the Employees tab, then the relevant employee.
- Under Personal Details, check the employee’s date of birth is correct. If it’s not, edit as required.
- Under Current Tax Details, from the NI Category drop-down, select the correct category. For more information, read National Insurance (NI).
- Select Save.
You can now process the employee’s pay details as normal. [BCB:299:UKI - Personal content block - Dane:ECB] [BCB:304:UKI - Search override - Payroll UK:ECB] [BCB:276:UKI - hide back button:ECB]
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