Late payment not allowed for Class 3 NICs

In Gek Siu Ng v HMRC [2022] TC08651, the First Tier Tribunal (FTT) dismissed Ms Ng's appeal to allow late payments of voluntary Class 3 NICs as the payment was a result of her own failure to exercise due care and diligence.

• HMRC wrote to Ms Ng in January 2008, stating that if she wished to pay Class 3 NICs for the period from 1996-97 through to 2001-02, payment would be required by 5 April 2009.
• In March 2008, Ms NG responded to HMRC acknowledging their letter and making a payment for the years 2002-03 to 2005-06 inclusive.
• HMRC wrote again in April 2008 to remind Ms Ng of the potential to make payments for the 1996-97 - 2001-02 period.
• Up until 2018, Ms Ng made intermittent Class 3 payments for the tax years 2007-08 through to 2016-17.
• In October 2018, she wrote to HMRC acknowledging that she had missed the 2009 deadline for the earlier payments due to human error and would like to make a late payment.
• HMRC refused to allow the late payment and Ms Ng appealed to the FTT.

The legislation sets out that payments can only be made after the deadline where the following test is met:

• The failure to meet the deadline was due to the payer's ignorance or error.
• The ignorance or error was not a result of the payer's failure to exercise due care and diligence.

The FTT found that:

• There was no dispute that Ms Ng was at fault for the non-payment.
• Ms Ng understood what Class 3 payments were for, the payment deadlines and the consequences for non-payment.
• Her time spent abroad did affect her ability to keep up to date with technical changes but she did understand the basic principles.
• Despite Ms Ng's contention that her continued Class 3 payments over the years showed a continued exercise of due care and diligence, non-payment followed by years of inaction does not show such exercise.
• The burden of proof was then on Ms Ng to show the non-payment was not a result of a lack of due care and diligence.
• The lack of any evidence to support this argument along with the concession in correspondence that the payment had 'slipped through the net' meant Ms Ng failed to establish that the error was not a result of her failure to exercise such care.

The appeal was dismissed.

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Gek Siu Ng v HMRC [2022] TC08651