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Employee Class 1 NIC  (primary)


2018/19

2017/18

NIC rate

Notes

LEL: Lower earnings limit    

per week

per month

per year

£116

£503

£6,032

£113

£490

£5,876

0%

Earnings below the lower earnings limit do not carry entitlement to benefits and no NIC is payable.

ET: Earnings threshold                                                         

per week

per month

per year

£162

£702

£8,424

£157

£680

£8,164

0%

No NIC is  payable on earnings below the ET but earnings between the LEL and ET carry entitlement to benefits.

UEL: Upper earnings limit  

Total NIC = (UEL-ET) x 12%      

per week

per month

per year

£892

£3,863

£46,350

£866

£3,750

£45,000

12%

These are the main rates for Category A (most earners). Category C (pensionable age) do not pay this. The state pension age for men is currently 65, but for women born before 6.4.1950 it was 60, however this will gradually rise to 66 - link

Above UEL

Total NIC = above UEL x 2% plus (UEL-ET) x 12%                                            

per week

per month

per year

> £892

> £3,863

> £46,350

> £866

> £3,750

> £45,000

2%

CLASS 2 (Self Employed)

2018/19

2017/18

Notes

Flat rate per week

£2.95

£2.85

These are paid by the self employed per week. Paying Class 2 NIC entitles you to certain benefits and is collected via self assessment e.g. 2018/19 - £2.95 x 52 = £153.40 (2017/18 - £148.20).

Special Class 2 for share fishermen - per week

£3.60

£3.50

Special Class 2 for volunteer development workers

£5.80

£5.65

Small earnings exception per year

£6,205

£6,025

CLASS 3 (Non-Employed - voluntary)

2018/19

2017/18

Notes

Rate per week

£14.65

£14.25

Voluntary and fills in gaps in NIC record.

CLASS 4 (Self Employed on Profits)

2018/19

2017/18

Notes

Annual lower profit limit (LPL)

Annual upper profit limit (UPL)

£8,424

£46,350

£8,164

£45,000

You pay this if you are self employed and your profits are over a certain amount. Under 16’s and those who reached state pension age at the start of the tax year do not pay Class 4 NIC.

Class 4 rate on profit between LPL and UPL

9%

9%

Class 4 rate on profit above UPL

2%

2%

National Insurance Contributions are payable by both employees and employers on earnings, subject to certain exceptions. Employees pay Class 1 NICs once their earnings exceed the earnings threshold (ET) - see below.

Employees over state pension age, or those under 16 years of age, do not pay Class 1 NICs. Employees with more than one job pay Class 1 NICs for each job, unless they apply for deferment in respect of the other jobs.

Employers do not pay Class 1 NICs for employees under 16, those earning under the earnings threshold and apprentices under 25. Employers pay Class 1A NICs on most benefits provided to relevant employees at the employers secondary Class 1 rates.

National Insurance

Employer Class 1 NIC  (secondary)


2018/19

2017/18

NIC rate

Notes

Below Secondary threshold (ET)    

per week

per month

per year

£162

£702

£8,424

£157

£680

£8,164

0%

No employer NIC is payable for under 21's provided their earnings are less than the UEL above. From April 2016 no employer NIC is payable on earnings up to UEL for apprentices aged under 25.

Above Secondary threshold (UEL)                                                         

per week

per month

per year

> £162

> £702

> £8,424

> £157

> £680

> £8,164

13.8%

EMPLOYER’S NIC ALLOWANCE

2018/19

2017/18

Notes

Employer’s NIC Allowance

£3,000

£3,000

Employers can claim this allowance against their liability for employer NIC contributions. It is not available to associated companies or, from April 2016, to a company where a director is the sole employee.