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IR3 Question 21 Shareholder-employee salary

If, as a shareholder-employee, you received a salary between 1 April 2018 and 31 March 2019 with PAYE deducted, include the amount in Box 11A.

If, as a shareholder-employee, your shareholder-employee’s salary or director’s fees had no PAYE deducted, include the amount in Box 21. If you would normally receive a shareholder-employee salary (even if you didn’t receive one this year), please tick 21A.

If you are not a shareholder employee and you received director’s fees with no tax deducted, show the income at Question 23.

The company that paid your salary or fees will be able to tell you exactly how much to show in your return.

Question 21B

In-work tax credit (IWTC) is for families who normally work a minimum number of hours each week, as follows:

  • a two-parent family where one or both parents between them normally work 30 hours or more a week

  • a single parent normally working 20 hours or more a week.

The eligibility criteria for IWTC changed from 1 April 2011 to include the hours worked without pay by major shareholders* in their close companies**. To qualify, the company must derive gross income.

If you’re already registered for WfFTC, and now meet the requirements for IWTC you’ll need to tick box 21B of your IR3.

If you’re not registered for WfFTC but you think you qualify, please complete a Working for Families Tax Credits registration form (FS1).

For more information go to (search keywords: in-work tax credit).

ACC earners’ levy

Shareholder-employee remuneration or director’s fees without PAYE deducted are liable for ACC earners’ levy. The company should deduct earners’ levy from your remuneration or director’s fees when declared. ACC will invoice the company for this.


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