New NI Codes for Freeports

5th August 2021

In case you thought the NI coding system was becoming too easy to follow, HMRC have announced 4 more NI codes in order to comply with the new regulations, starting in April 2022, for those companies trading within one of the newly established Freeport areas.


  • F – standard category letter
  • I – married women & widows entitled to pay reduced NIC’s
  • S – employees above state pension age
  • L – employees who defer paying 12% NIC, only paying 2% as they pay full contributions elsewhere.


In other words, these new codes match the existing A, B, C & J that will still be used by employees working for firms not working within the boundaries of one of the new Freeport areas.


In England, Scotland & Wales employers with a physical presence within a Freeport tax site can operate a zero-rated Employer Class 1 NIC’s for new employees who spend at least 60% of their time working within the Freeport tax site. New employees are classed as starting after April 2022 & must not have worked for the employer (or a business connected to the employer) in the previous 24 months. Existing employee are not included in the scheme. The zero rate can be applied up to a threshold of £25,000 per annum for a maximum period of 36 months for each employee. Earnings above £25,000, the Freeport Upper Secondary Threshold (FUST) will be charged at 13.8%.


The relief to employers who qualify for the new scheme is due to run for nine years ending in 2031. However, HMRC have stated they will review the policy part way through to determine whether or not it should continue.


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