Detailed guide: Pay Contributions Equivalent Premiums

Updated: Payments can no longer be made at a Post Office.

Overview

Employers or pension scheme administrators pay a Contributions Equivalent Premium (CEP) when an employee leaves and:

  • has less than 2 years pensionable service
  • is not entitled to any benefits from a contracted-out salary related scheme
  • has rights in the state scheme which can be restored by payment of a CEP

How much time to allow

Make sure you pay HMRC by the deadline or you may have to pay a penalty.

The time you need to allow depends on how you pay.

Payment method Time allowance
Online or telephone banking (Faster Payments) Same or next day
CHAPS Same or next day
Government Banking Service Same or next day
At your bank or building society Same or next day
Bacs 3 working days
By cheque through the post 3 working days

If the deadline falls on a weekend or bank holiday, make sure your payment reaches HMRC on the last working day before (unless you’re paying by Faster Payments).

Ways to pay

Bank details for online or telephone banking, CHAPS and Bacs

You can pay by Faster Payments, CHAPS or Bacs to HMRC’s account.

Sort code Account number Account name
20 20 48 30944793 GBS Re NICO Receipts HMRC

You’ll need your 9-character Scheme Contracting Out Number (SCON). You’ll find this on your contracting out certificate.

Your payment may be delayed if you use the wrong reference number.

Payments by:

  • Faster Payments (online or telephone banking) usually reach HMRC on the same or next day, including weekends and bank holidays
  • CHAPS usually reach HMRC the same working day if you pay within your bank’s processing times
  • Bacs usually take 3 working days

Check your bank’s transaction limits and processing times before making a payment.

The Government Banking Service (GBS)

Employers such as government departments and health authorities who have a GBS account can pay using the GBS online service.

If you enter HMRC’s GBS account details incorrectly there may be a delay updating your record or your payment may not reach HMRC.

Provided you make a payment by the GBS deadline it will reach HMRC on the same day.

At your bank or building society

Use your payslips to pay at your own bank or building society. You can pay by cash or cheque made payable to ‘HM Revenue and Customs only’ followed by your 9-character SCON. You’ll find this on your contracting out certificate.

Your payment may be delayed if you use the wrong reference number.

HMRC will accept your payment on the date you make it and not the date it reaches HMRC’s account, if you pay between Monday and Friday.

By cheque through the post

Send your cheque made payable to ‘HM Revenue and Customs only’ followed by your 9-character SCON. You’ll find this on your contracting out certificate.

Don’t fold the cheque or fasten it to other documents.

HMRC will accept your payment on the date you make it and not the date it reaches HMRC’s account, if you pay between Monday and Friday.

HM Revenue and Customs

NISPI Payments

Room BP2102

Benton Park View

Newcastle upon Tyne

NE98 1ZZ

If you’re paying by post, you can include a letter with your payment to request a receipt from HMRC.

Source: HMRC

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