National Insurance Contributions

If you’re employed you pay Class 1 National Insurance contributions. The rates are:

• if you earn more than £149 a week and up to £797 a week, you pay 12 per cent of the amount you earn between £149 and £797
• if you earn more than £797 a week, you also pay 2 per cent of all your earnings over £797

You pay a lower rate if you’re a member of your employer’s contracted-out pension scheme.

Your contributions are deducted from your wages by your employer.

If you’re self-employed you pay Class 2 and Class 4 National Insurance contributions. The rates are:

• Class 2 National Insurance contributions are paid at a flat rate of £2.70 a week
• Class 4 National Insurance contributions are paid as a percentage of your annual taxable profits – 9 per cent on profits between £7,755 and £41,450, and a further 2 per cent on profits over that amount.

If your profits are expected to be less than £5,725 you may not have to pay Class 2 National Insurance contributions.

Your Class 2 National Insurance contributions payments are due on 31 January and 31 July, the same as a Self Assessment tax bill. You pay Class 2 National Insurance contributions either monthly or six monthly by Direct Debit – follow the first link below for more information about payment dates.

You pay Class 4 National Insurance contributions when you pay your Income Tax.

For further information: http://www.hmrc.gov.uk/ni/intro/basics.htm

 See Also:

 

– Money
– National Insurance Number
– Child Benefits
– Tax Credits