National insurance contributions

National insurance contributions and rates in 2017/18

 

Employee   Employer  
Earnings per week   Earnings per week  
Up to £113                     Nil* Up to £157                        0%
From £113.01 to £157                   0% Over £157                       13.8%*
From £157.01 to £866  12% Over state retirement age 13.8%
Over £866                        2%   
Over state retirement age      0%                                       

*0% for employees under 21 and apprentices under 25 on earnings up to £866 per week.

Employment allowance

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 £113 and £157 per week

**The rate is 0% in relation to employees under 21 and apprentices under 25 on earnings up to £866 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) £2.85 per week
Class 2 contributions - share fishermen £3.50 per week
Class 2 contributions - volunteer development workers £5.65 per week
Small profits threshold £6,025 per annum
Contributions cease at state retirement age  
Class 3 (voluntary) £14.25 per week
   
Class 4* (Self employed on profits)  
£8,164 to £45,000 9%
Above £45,000 2%
*Exemption applies if state retirement age was reached by 6 April 2017.
   
Maximum contributions  
Class 1 £4,424.16  + 2% of earnings over £45,000  pa.
Class 2 and Class 4 £3,463.44  + 2% of profits over £45,000  pa.

Notes

  1. For children under 16, and employees over state pension age there are no national insurance contributions payable, but employers' contributions remain payable.
  2. No employers national insurance contributions are payable for those under 21, or 25 for an apprentice.

2018 and beyond

Class 2 national insurance contributions will be abolished from April 2018.

Get in touch for a free Consultation Today

Find out more