National Insurance Contributions

Tax Rates 2023/24

 

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 Insurance Contributions

Class 1 (Employees)

  Employee Employer
Main NIC rate 12% 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 qualifying 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 2022/23.

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 above £12,570 £3.45

Class 3 (Voluntary)

Flat rate per week £17.45

Class 4 (Self employed)

On profits £12,570 – £50,270 9%
On profits over £50,270 2%

Employees with earnings above £123pw and the self-employed with profits over £6,725 access entitlement to contributory benefits.
 
6.4.2022 to 5.7.2022: No NIC on first £190pw £175pw
6.7.2022 to 5.4.2023: No NIC on first £242pw £175pw
Main NIC rate – 6.4.2022 to 5.11.2022 13.25% 15.05%
Main NIC rate – 6.11.2022 to 5.4.2023 12.00% 13.80%
Main rate* charged up to £967pw no limit
On earnings above £967pw N/A
– 6.4.2022 to 5.11.2022 3.25% N/A
– 6.11.2022 to 5.4.2023 2.00% N/A
Directors have the following rates:    
– On earnings between £11,908 and £50,270 12.73% 14.53%
– On earnings over £50,270 2.73% 14.53%
Employment allowance per qualifying 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.

Employer contributions 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). Both Class 1A and 1B are payable at a rate of 14.53%. However, where a Class 1A liability arises in relation to a sporting testimonial payment or a relevant termination award, the rate will be that in force at the time (i.e. 15.05% or 13.80%).

Class 2 (Self employed)
Flat rate per week if profits above £11,908 £3.15
Class 3 (Voluntary)
Flat rate per week £15.85
Class 4 (Self employed)
On profits between £11,908 and £50,270 9.73%
On profits over £50,270 2.73%