I blogged about the chaos that was being caused as a result of National Insurance numbers (NINOs) being issued with KC prefixes. On 8 July 2016, HMRC’s PAYE Service Issues page was updated with a message about the issue
Last week, I blogged about the chaos that was being caused as a result of National Insurance numbers (NINOs) being issued with KC prefixes. The problem is that KC was not on HMRC’s list of valid prefixes issued to software developers. So, while KC is a valid prefix, HMRC’s systems do not recognise it and in all probability, payroll software will not recognise it either. The result is that either payroll software will reject the National Insurance number or HMRC will reject the FPS.
On 8 July 2016, HMRC’s PAYE Service Issues page was updated with a message about the issue. This was followed up with the same message to software developers:
“We are aware that a small number of National Insurance numbers with prefix ‘KC’ were issued recently and that these are causing some problems for our customers.
“The National Insurance numbers with the prefix ‘KC’ are valid and customers receiving them should use them as normal.
“If you are experiencing issues when submitting Real Time Information (RTI) data for an employee with this National Insurance number, the following steps should be taken:
• The National Insurance number field should be left blank
• You should make sure the employee address field is completed in those cases
• If you/your employee has a ‘KC’ National Insurance number, they don’t need to request a new one
“We are working hard to resolve this issue quickly and will provide more information shortly.”
This is a welcome acknowledgement that HMRC is aware of the issue. In the meantime, the temporary workaround is to leave the NINO field blank but ensure the first two lines of the address are completed. The workaround for software developers is “do nothing”. However, I wonder what the permanent fix will hold in store.
This is not the end of the story by any means. The NINO needs to be declared to HMRC at some point and may be used for many other things in the immediate future – such as pension returns. However, as at 11 July 2016, this is the state of play.