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National Insurance Contributions — Rates

Class 1 — Employee and employer

Earnings 2021/22 2020/21
Employee Employer Employee Employer
Below Lower Earnings Limit (LEL) Nil Nil Nil Nil
Above LEL to Earnings Threshold (ET) 1 0% 0% 0% 0%
Above ET to Upper Earnings Limit (UEL) 2 12% 13.8% 12% 13.8%
Above UEL 2% 13.8% 2% 13.8%
  1. Although no NICs are payable, to protect an employee's entitlement to contributory benefits notional Class 1 NICs are deemed to have been paid on earnings between the LEL and the ET.
  2. Employers are not required to pay Class 1 NICs on earnings up to the Upper Secondary Threshold (UST) for any employee aged under 21. Employers are not required to pay Class 1 NICs on earnings paid up to the Apprentice Upper Secondary Threshold (AUST) to apprentices under the age of 25. As shown in the NIC Threshold tables the UST and AUST will be the same as the UEL in 2021/22.
  3. It is intended that employer NIC relief will be made available for eligible employees working in all Freeport tax sites from April 2022 or when a tax site is designated if after this date. This would be available until at least April 2026 with the intention to extend for up to a further five years to April 2031, subject to a review of the relief.

Class 1A and Class 1B — Employer

Earnings or benefits 2021/22 2020/21
Class 1A
- Most taxable benefits, including car and fuel benefit charges 13.8% 13.8%
Class 1B
- Earnings in a PAYE Settlement Agreement and income tax thereon 13.8% 13.8%

Class 2 and Class 4 — Self employed

Income or profits 2021/22 2020/21
Class 2 1
- Below Small Profits Threshold (SPT) 1 £3.05 £3.05
- Weekly flat rate above SPT £3.05 £3.05
Class 4 
- Below Small Profits Threshold (SPT) 0% 0%
- Between SPT and Lower Profits Limit (LPL) 0% 0%
- Between LPL and Upper Profits Limit (UPL) 9% 9%
- Above UPL 2% 2%
  1. Payment of Class 2 NICs is voluntary for those earning less than the Small Profits Threshold.

Class 3 — Voluntary

Contributions 2021/22 2020/21
Class 3
- Weekly flat rate voluntary payment £15.40 £15.30