National insurance contributions
National insurance contributions and rates in 2018/19
|Up to £162||nil*||nil*|
|From £162.01 to £892||12%||13.8%|
|Over state pension age||0%||13.8%|
*0% for employees under 21 and apprentices under 25 on earnings up to £892 aweek.
An employer can claim employment allowance of £3,000. Only 1 claim may be made by the employer.
*Entitlement to contribution-based benefits retained for earnings between £116 and £162 per week
**The rate is 0% in relation to employees under 21 and apprentices under 25 on earnings up to £892 per week
***Per employer, per year. 1 claim only for companies in a group or under common control. Not available if the only paid employee is a director.
|Class 1A (on relevant benefits)||13.8%|
|Class 1B (on PAYE settlement arrangement)||13.8%|
|Class 2 (self-employed)||£2.95 per week|
|Class 2 contributions - share fishermen||£3.60 per week|
|Class 2 contributions - volunteer development workers||£5.80 per week|
|Small profits threshold||£6,205 per annum|
|Contributions cease at state retirement age|
|Class 3 (voluntary)||£14.65 per week|
|Class 4* (self-employed on profits)|
|£8,424 to £46,350||9%|
|*Exemption applies if state retirement age was reached by 6 April 2018.|
| Reduced rate for certain married women
(on earnings between £162 and £892)
|Class 1||£4,642.80 + 2% of earnings over £46,350 pa.|
|Class 2 and Class 4||£3,569.69 + 2% of profits over £46,350 pa.|
|Apprenticeship levy allowance (employer*)||£15,000|
|Apprenticeship levy rate||0.5%|
Levy-paying employers can create an account on the apprenticeship service in order to spend levy funds on apprenticeships, manage their apprentices and manage payments to training providers.
Employers are entitled to an annual levy allowance of £15,000 to set against this levy.
They can sue one-twelfth of the levy per tax month on a cumulative basis, unused levy allowance can be carried forward and used in a later month within the same year.
*Shared between connected companies - allocated as the companies choose before the start of the tax year.
- For children under 16, and employees over state pension age there are no national insurance contributions payable, but employers' contributions remain payable.
- No employers national insurance contributions are payable on earnings up to £892 per week for those under 21, or 25 for an apprentice.
2019 and beyond
Class 2 national insurance contributions will be abolished from April 2019.
Class 1A NICs will become due on termination payments over £30,000 and sporting testimonials over £100,000.