National Insurance Contributions (NICs)
|Payable on weekly earnings of:|
|Below £112 (lower earnings limit)||Nil||-|
|£112 - £155 (primary threshold)||*0%||-|
|Up to £156 (secondary threshold)||-||Nil|
|£155.01 - £827 (upper earnings limit)||**12%||-|
£156.01 - £827 (upper secondary threshold (UST) for
£156.01 - £827 (apprentice upper secondary threshold
(AUST) for under 25s)
*No NICs are actually payable but a notional Class 1 NIC is deemed to have been paid; this protects contributory benefit entitlement.
**Over state pension age, the employee contribution is generally nil.
|Employment Allowance||Up to £3,000 (per year)|
|Class 1A||On relevant benefits||13.8%|
|Class 2||Self employed||£2.80 per week|
|Small profits threshold||£5,965 per annum|
|Class 3||Voluntary||£14.10 per week|
|Class 3A||Voluntary contributions may be available to 5 April 2017 in order to obtain extra additional State Pension (maximum £25 a week) - variable contribution rates according to age|
|Class 4||Self employed on annual profits|
|£8,060 - £43,000||*9%|
|Excess over £43,000||*2%|
|*Exemption applies if state pension age was reached by 6 April 2016.|
Changes to the Employment Allowance
From April 2016 the annual Employment Allowance for employer NICs increases from £2,000 to £3,000. However, companies where the director is the sole employee will no longer be able to claim this allowance.
It was announced that from April 2018, Class 2 NICs will be abolished, and a reform of Class 4 NICs will be undertaken.
From April 2018, employer NICs will be due on termination payments above £30,000 that are already subject to income tax.
The first £30,000 of a termination payment will remain exempt from income tax and the full payment will be outside the scope of employee NICs.