Awards to Inventors (ATI)

by Steven
(Watford, Hertfordshire, UK)

What are the personal tax and NI liabilities for ATI payments received from a former employer?

These ATI payments are directly linked to royalties received by the former employer from 3rd party collaborators, where I (and others) were named inventors on patents directly linked to the commercialisation of the product.

The ATI payments are defined by a strict formula and are capped. Whilst I was an employee of the company I received ATI payments (which were non-consolidated and non-pensionable) in the same way that I received annual bonuses, i.e. I paid tax and NI.

Now that I am retired I wondered whether this tax/NI treatment was still valid? If it is, will my ex-employer have to pay employers NI contributions as well?

Thanks, Steve