National Insurance Contributions

Tax Rates 2024/25

 

Introduction
Income Tax
Pensions
Annual investment limits
National Insurance Contributions
Vehicle Benefits
Tax-free mileage allowances
Capital Gains Tax
Corporation Tax
Main capital allowances
Property Taxes
Value Added Tax
Inheritance Tax
Key dates and deadlines
Useful rates
National minimum wage

National Insurance Contributions

Class 1 (Employees)

  Employee Employer
Main NIC rate 8% 13.8%
No NIC on first £242pw £175pw
Main rate charged up to* £967pw no limit
2% rate on earnings above £967pw N/A
Employment allowance per business** N/A £5,000

*Nil rate of employer NIC on earnings up to £967pw for employees aged under 21, apprentices aged under 25 and ex-armed forces personnel in their first twelve months of civilian employment.

**Some businesses do not qualify, including certain sole director companies and employers who have an employer’s Class 1 NIC liability of £100,000 or more for 2023/24.

Employer contributions (at 13.8%) are also due on most taxable benefits (Class 1A) and on tax paid on an employee’s behalf under a PAYE settlement agreement (Class 1B).

Class 2 (Self employed)

Flat rate per week if profits below £6,725 (voluntary) £3.45

Class 3 (Voluntary)

Class3: Flat rate per week £17.45

Class 4 (Self employed)

On profits £12,570 – £50,270 6%
On profits over £50,270 2%

Employees with earnings above £123pw and the self-employed with profits over £6,725 (or who pay voluntary Class 2 contributions) can access entitlement to contributory benefits.