'Sleeping' and Inactive Limited Partners - New NICs Liability

HM Revenue and Customs (HMRC) have had a rethink as regards the law governing National Insurance Contributions (NICs) and announced that sleeping partners and inactive limited partners are liable to pay Class 2 NICs as self-employed earners and Class 4 NICs in respect of their taxable profits.

From 6 April 2013, sleeping or inactive limited partners must pay Class 2 NICs unless covered by one of the exemptions.

Any Class 4 NICs liability should be accounted for in the 2013/2014 tax year of assessment and for subsequent tax years.

You can register for Class 2 NICs and self-assessment online.

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.