National Insurance is due on earnings for employees and self-employed workers. There are different Classes of National Insurance applicable to different income types.
Self Employed individual
Applies to anyone aged 16 or over and under state pension age:-
|Self Employed individual||2022/23||2023/24|
|Class 2 Flat Rate (per week)||£3.15||£3.45|
|Class 4 @ 9% (9.73% 2022/23) on profits between||£11,909 – £50,270||£12,570 – £50,270|
|Class 4 @ 2% (2% 2022/23) on profits in excess of||£50,270||£50,270|
- Class 2 and Class 4 National Insurance is collected as part of the self-assessment tax liability.
- Class 2 National Insurance stops when a person reaches State Pension age.
- Class 2 National Insurance is due when self-employed profits exceed £12,570 per year (£11,908 2022/23)
- Class 4 National Insurance liability ceases from the start of the tax year after the one in which the person reaches State Pension age.
|No NI on earnings up to (per week)||£242*||£242|
|At 12% (12% 2022/23) on earnings between (per week)||£242- £967||£242-£967|
|At 2% (2% 2022/23) on earnings in excess of (per week)||£967||£967|
- * from July 2022
- Entitlement to state pension and other contribution based benefits is retained for earnings between £123 and £242 per week.
|Employer NI is due at 13.8% (13.8% 2022/23) on employee weekly earnings in excess of||£175||£175|
- Employment Allowance available to cover first £5,000 (£5,000 2022/23) of Employer National Insurance contributions due (Since 6 April 2020, the Employment Allowance has not been available to employers whose only employee is a director).
- Since 6 April 2020 the Employment Allowance has been considered under State Aid rules.
- Employer National Insurance is not due for Employees aged 21 or under.
- From 6 April 2016, there is no Employer NI due for employees who are apprentices and aged under 25 up to the upper secondary threshold of £967 per week.
- Class 3 National Insurance can be paid on a voluntary basis to fill gaps in a person’s National Insurance record in order to qualify for full State Pension
- If you wish to look into the Employment Allowance in closer detail then please click the link > Employment Allowance