Employees who are resident, ordinarily resident, or physically present in the UK (or who would be so present but for an absence which is merely temporary, eg a holiday abroad) are subject to employee's Class 1 contributions, and the employer (if present in the EEA) is subject to Class 1, Class 1A and Class 1B contributions in respect of them1. Although from 6 April 2013 the concept of ordinary residence no longer applies for tax purposes (being replaced by a statutory residence rule; see Division E6.1) the rules for National Insurance are different and the concept of ordinary residence applies for National Insurance purposes.
Residence and ordinary residence
The determination of 'residence' for National Insurance purposes is not the same as for tax purposes, and the fact that a person is UK resident for tax purposes under the statutory residence test does not automatically mean that the person is resident for National Insurance purposes. For National Insurance purposes, within an EEA context, the term 'residence' is defined2 as the place where a person habitually
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Web page updated on 17 Mar 2025 13:23