The above brief sets out the conditions for NIC refunds following the repeal of the Social Security (Categorisation of Earners) Regulations 1978 in relation to lecturers, teachers, instructors or those in a similar capacity.

Prior to 6 April 2012, the above regulations made provision for treating lecturers, teachers, instructors or those in a similar capacity in traditional educational establishments, such as schools, colleges or universities etc, who were not employed under a contract of service (an employment contract) as employees for NICs purposes.

With effect from 6 April 2012 the relevant provisions of the Regulations were repealed so that the Regulations no longer apply. However, prior to repeal, it is possible that earlier published HMRC guidance may have led some training providers particularly in the vocational or recreational sector to incorrectly apply the Regulations to payments made to trainers engaged under self-employment contracts.

If the Regulations were incorrectly applied, Class 1 NICs may have been accounted for and paid to HMRC in error. HMRC will now consider claims for the refund of any incorrectly paid contributions. Such claims are limited by statute so that refunds may only be made in respect of the last two tax years or, where a decision was requested/challenged and this remains undetermined, the tax year in which the challenge was made and the preceding tax year.

Refunds may be made by trainers or instructors, or those who engaged them, and where amounts of NICs were paid in error following HMRC's guidance. This primarily affects those engaged in the provision of vocational or recreational training as set out in HMRC's guidance prior to repeal of the relevant provisions of the Regulations.

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