National Insurance contributions
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Class 1 (Employees)
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Contracted In
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Contracted Out
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Employee contributions
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Salary Related
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Money Purchase
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- on earnings between £110.01 - £770pw
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11.0%
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9.4%
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9.4%
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- on earnings between £770.01 - £844pw
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11.0%
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11.0%
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11.0%
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- on earnings above £844pw
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1.0%
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1.0%
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1.0%
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Employer contributions
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- on earnings between £110.01 and £770pw
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12.8%
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9.1%
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11.4%
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- on earnings above £770pw
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12.8%
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12.8%
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12.8%
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Employer contributions (at 12.8%) are also due on most benefits in kind and on tax paid on an employee's behalf under a PAYE settlement agreement.
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Class 2 (Self-employed)
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Flat rate per week
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£2.40
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Small earnings exception: profits per annum
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£5,075
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Class 3 (Voluntary)
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Flat rate per week
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£12.05
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Class 4 (Self-employed)
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On profits £5,715 - £43,875
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8.0%
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On profits over £43,875
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1.0%
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From September 2010, there will be a "holiday" from employee's NIC for new businesses employing up to 10 new employees in their first year. The maximum benefit is £5000 per employee. Businesses in certain areas, such as London and the SE, are excluded.
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