National Insurance Contributions — Thresholds
Class 1 — Employee and employer
| 2023/24 | 2022/23 | |||||
|---|---|---|---|---|---|---|
| Earnings | Weekly | Monthly | Annual | Weekly | Monthly | Annual |
| Lower Earnings Limit (LEL) | £123 | £533 | £6,396 | £123 | £533 | £6,396 |
| Earnings Threshold(ET) | ||||||
| - Primary Threshold (PT) 1, 2 | £242 | £1,048 | £12,570 | £242 | £1,048 | £12,570 |
| - Secondary Threshold (ST) 3 | £175 | £758 | £9,100 | £175 | £758 | £9,100 |
| Freeport Upper Secondary Threshold (FUST) | £481 | £2,083 | £25,000 | £481 | £2,083 | £25,000 |
| Investment Zone Upper Secondary Threshold (IZUST) | £481 | £2,083 | £25,000 | N/A | N/A | N/A |
| Upper Secondary Threshold (UST) | £967 | £4,189 | £50,270 | £967 | £4,189 | £50,270 |
| Apprentice Upper Secondary Threshold (AUST) | £967 | £4,189 | £50,270 | £967 | £4,189 | £50,270 |
| Veterans Upper Secondary Threshold (VUST) | £967 | £4,189 | £50,270 | £967 | £4,189 | £50,270 |
| Upper Earnings Limit (UEL) 4 | £967 | £4,189 | £50,270 | £967 | £4,189 | £50,270 |
| Employment allowance 5 | £5,000 | £5,000 | ||||
| Apprenticeship levy 6 | £15,000 | £15,000 | ||||
- The PT will be frozen until April 2028.
- The PT was increased with effect from 6 July 2022. Between 6 April 2022 and 5 July 2022, the respective thresholds were: weekly – £190; monthly – £823, annual – £9,880.
- The ST will be frozen until April 2028.
- The UEL, along with the UST, AUST and VUST, will remain aligned with the UK higher rate tax threshold, at £50,270, until April 2028.
- The annual employment allowance may be offset against an employer’s Class 1 NICs but must be claimed via the normal payroll process. The allowance is not available to companies of which a director is the sole employee, and is restricted to employers whose NIC liability is less than £100,000.
- The apprenticeship levy is set at a rate of 0.5% of an employer’s annual pay bill and is collected via PAYE. As the annual allowance is used to offset the payment of the levy, the levy is only paid by employers whose pay bills exceed £3 million per year.
Class 2 and Class 4 — Self employed
| Income or profits | 2023/24 | 2022/23 |
|---|---|---|
| Annual | Annual | |
| Class 2 | ||
| - Small Profits Threshold (SPT) | £6,725 | £6,725 |
| Class 4 | ||
| - Small Profits Threshold (SPT) | £6,725 | £6,725 |
| - Lower Profits Limit (LPL) 1 | £12,570 | £11,908 |
| - Upper Profits Limit (UPL) 2 | £50,270 | £50,270 |
- The LPL will be frozen until April 2028.
- The UPL will remain aligned with the UK higher rate tax threshold, at £50,270, until April 2028
Other classes
Class 1A NICs are paid on amounts reported on Form P11D(b).
Class 1B NICs are paid on earnings included in a PAYE Settlement Agreement and income tax thereon.
Class 3 NICs are paid voluntarily by persons not liable for contributions, or who are excepted from Class 2 NICs or whose contributions are insufficient to qualify for benefits.