Accessibility links

  • Skip to content
  • Accessibility Help

You are using an outdated browser. Upgrade your browser today for a better experience of this site and many others.

MENU
  • Home
  • About us
  • Services
    • Overview
    • Business start-up
    • Compliance services
    • Investments & Pensions
    • Support services
    • Taxation
  • Factsheets
    • Overview
    • Capital taxes
    • Corporate and business tax
    • Employment and related matters
    • Employment issues (tax)
    • General business
    • ICT
    • Pensions
    • Personal tax
    • Specialist areas
    • Starting up in business
    • VAT
  • Resources
    • Overview
    • accSEND
    • Downloadable forms
    • Market data
    • Online calculators
    • Tax calendar
    • Tax rates & allowances
    • Useful links
  • News
    • Overview
    • Statement
    • Budget
    • Hot Topic
    • Latest News for Business
  • Contact us
J R Watson & Co Accountants

Northampton: 01604 630745 Rugby: 01788 575037 Email us

National insurance

Earnings thresholds and contribution percentages for Class 1 (employed), Class 2 and 4 (self-employed) and Class 3 (voluntary) national insurance contributions.

  1. Resources
  2. Tax rates & allowances

Class 1

Employees start paying Class 1 NIC from age 16 (if sufficient earnings).

Employers pay Class 1 NIC in accordance with the table below.

Employer NIC for employees under the age of 21 and apprentices under the age of 25 is reduced from the normal rate of 15.05% to 0% up to the Upper Secondary Threshold of £967 per week. Also applies to veterans in the first 12 months of employment.

Employees Class 1 NIC stop when they reach their 'State Pension age'. The employer's contribution continues.

Employees

2022/23:

Earnings per week %
Up to £190 1 Nil
£190.01 - £967 13.25
Over £967 3.25
  1. £242 from 6 July 2022

Entitlement to state pension and other 'contribution-based benefits' is retained for earnings between £123 and £190 per week.

2021/22:

Earnings per week %
Up to £184 Nil
£184.01 - £967 12
Over £967 2

Entitlement to state pension and other 'contribution-based benefits' is retained for earnings between £120 and £184 per week.

Employers

2022/23:

Earnings per week %
Up to £175 Nil
Over £175 15.05

2021/22:

Earnings per week %
Up to £170 Nil
Over £170 13.8

Other National Insurance payable by employers

Class 1A

15.05% on broadly all taxable benefits provided to employees and on certain taxable termination and sporting testimonial payments in excess of £30,000.

Class 1B

15.05% on taxable PAYE Settlement Agreements.

Class 2 and 4 (self-employed)

A self-employed person starts paying Class 2 and Class 4 NIC from 16 or over (if sufficient profits).

Class 2 NIC stop when a person reaches State Pension age.

Class 4 NIC stop from the start of the tax year after the one in which the person reaches State Pension age.

2022/23:

Class 2 (£)
Flat rate per week 3.15
Small Profits Threshold (per year) 6,725
Lower Profits Limit 11,908

2021/22:

Class 2 (£)
Flat rate per week 3.05
Small Profits Threshold (per year) 6,515

For 2022/23 the point at which the self-employed person starts to pay Class 2 NICs will increase to £11,908. This means those with profits between the Small Profits Threshold and the Lower Profits Limit will not pay Class 2 NICs, but will still be able to access entitlement to contributory benefits. A self-employed person with profits below the Small Profits Threshold might decide to carry on paying Class 2 voluntarily to accrue entitlement to the State Pension and other benefits.

Class 4

2022/23:

Annual profits %
Up to £11,908 Nil
£11,908.01 - £50,270 10.25
Over £50,270 3.25

2021/22:

Annual profits %
Up to £9,568 Nil
£9,568.01 - £50,270 9
Over £50,270 2

Class 3

A person needs 35 years (30 years if State Pension age is before 6 April 2016) of NIC to get a full State Pension.

Class 3 voluntary contributions can be paid to fill or avoid gaps in a NI record.

Flat rate per week: £15.85 (2021/22: £15.40)

Capital allowances Capital gains tax Child benefit Corporation tax Income tax Individual Savings Account (ISA) Inheritance tax Minimum wage National insurance Pensions Stamp duty & land taxes Statutory pay Tax reliefs for individuals Value added tax Vehicles

The latest news

09 May 2022

HMRC starts chasing up SEISS overpayments

HMRC has started to recover overpayments of Self-employment Income Support Scheme (SEISS) grants.

09 May 2022

UK government unveils energy strategy

Up to eight more nuclear reactors could be delivered to existing sites as part of the UK's new energy strategy.

09 May 2022

Treasury announces it will regulate some forms of cryptocurrency

The Treasury has announced that it plans to recognise stablecoins as a valid form of payment as part of a wider government initiative to 'make Britain a global hub for cryptoasset technology and investment'.

Home | Site map | Accessibility | Disclaimer | Privacy | Help |

© 2022 J R Watson & Co Accountants. All rights reserved.

Northampton Office: Chancery House, 52 Sheep Street, Northampton, Northamptonshire NN1 2LZ
Rugby Office: Sir Frank Whittle Business Centre, Great Central Way, Rugby, CV21 3XH

We use cookies on this website, you can find more information about cookies here.

powered by totalSOLUTION

Would you like to download our mobile app from the App Store?

Download
x