Paying National Insurance Contributions (NICs) build up your entitlement to state benefits and state pensions. The total amount of NICs contributed depends on your average weekly earnings and there are a number of different percentages of NICs for each type of employee.
NICs are payable by those that are between 16 and 65 and who are either employed or self-employed. These are payable either on a voluntary or involuntary basis.
Employees pay Class 1 Primary NICs at 12% between £149 and £797 per week and additional 2% on any salary above £797.
Your employer will ‘top up’ your contributions by paying Class 1 Secondary NICs on your behalf.
Being self-employed means that you will have to pay Class 2 NICs at a flat rate of £2.70 per week for the total duration of being self-employed. In addition to this, you will have to pay Class 4 NICs on profits between £7,755 and £41,450 at 9%. Profits made in excess of this will require Class 4 NICs of 2%.
If you wish to find out more about NICs please contact the Wisteria Tax team.
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