Security for PAYE and NICs

HMRC estimates that the Exchequer lost between £600 million and £800 million per year between 2005/06 and 2008/09 in PAYE and NICs debts that had been built up by employers who then became insolvent.

To help prevent this, legislation in the Finance Bill 2011 introduces a power to allow HMRC to make regulations enabling them to require a security from employers for PAYE that is seriously at risk. The measure will also introduce a criminal offence for non-payment of a security.

Once the new power is in place, HMRC will use existing powers to make equivalent provision in respect of NICs.