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||2021/22||2022/23|
|Class 2 Flat Rate (per week)||£3.05||£3.15|
|Class 4 @ 10.25% (9% 2021/22) on profits between||£9,568 – £50,270||£9,880 – £50,270|
|Class 4 @ 3.25% (2% 2021/22) 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 £6,725 per year (£6,515 in 2021/22)
- 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)||£184||£190*|
|At 13.25% (12% 2021/22) on earnings between (per week)||£184 – £967||£190-£967|
|At 3.25% (2% 2021/22) on earnings in excess of (per week)||£967||£967|
- * from July 2022 this threshold will be £242
- Entitlement to state pension and other contribution based benefits is retained for earnings between £123 and £190 per week.
|Employer NI is due at 15.05% (13.8% 2021/22) on employee weekly earnings in excess of||£170||£175|
- Employment Allowance available to cover first £5,000 (£4,000 2021/22) 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