National Insurance Contributions (NICs)


The Different Types of NICS:

A diagram of the different classes of National Insurance Contributions (NICs) and who they are paid by.

CLASS 1
EMPLOYEE
CLASS 1 EMPLOYERCLASS 1A EMPLOYERCLASS 2 SELF EMPLOYEDCLASS 4 SELF EMPLOYED
PAYABLE ONGROSS CASH EARNINGSGROSS CASH EARNINGSTAXABLE BENEFITS GIVEN TO EMPLOYEEFLAT RATE ABOVE PROFIT THRESHOLDTAX ADJUSTED TRADING PROFITS AFTER TRADING LOSSES
PAYABLE WHEN 16 YRS – STATE PENSION AGE16 YRS OR OVER16 YRS OR OVER16 YRS – STATE PENSION AGE16 YRS – STATE PENSION AGE AT START OF TAX YEAR
RATE 12% ON EARNINGS BETWEEN £9,501 – £50,000. 2% ABOVE £50,00013.8% ABOVE £8,788 13.8%£3.05 PER WEEK IF TAX-ADJUSTED TRADING PROFITS ABOVE £6,4759% BETWEEN £9,500 AND £50,000. 2% ABOVE £50,000
DUE PAYE: 22ND OF EACH MONTHPAYE: 22ND OF EACH MONTH22ND JULY AFTER THE TAX YEAR31 JANUARY FOLLOWING TAX YEAR UNDER SELF-ASSESSMENTPAYMENT ON ACCOUNT (POA): 31 JAN IN TAX YR, 31 JULY AFTER TAX YEAR AND 31 JAN AFTER TAX YEAR.

NOTE: CLASS 4 NICS are BEFORE deducting the PERSONAL ALLOWANCE and are paid at the same time as the individual pays their INCOME TAX. Hence they will be paid under PAYMENT ON ACCOUNT rules, if these apply.


NIC Employment Allowance – Employer Class 1

Employers can claim up to £4,000 tax relief per annum, which can be set off against their EMPLOYER’S CLASS 1 NIC contributions ONLY.

This relief is NOT available to COMPANIES where a DIRECTOR is the ONLY EMPLOYEE.