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National Insurance Contributions — Rates

Class 1 — Employee and employer

Earnings 2018/19 2017/18
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 2018/19.

Class 1A and Class 1B — Employer

Earnings or benefits 2018/19 2017/18
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 2018/19 2017/18
Class 2 1
- Below Small Profits Threshold (SPT) £0.00 £0.00
- Weekly flat rate above SPT £2.95 £2.85
Class 4 2
- 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. In the 2017 Autumn Budget the government has announced that it will delay the abolition of Class 2 NICs for one year, until April 2019.
  2. The government will reform Class 4 NICs so that self employed individuals continue to build entitlement to the state pension and other contributory benefits following the abolition of Class 2 NICs.

Class 3 — Voluntary

Contributions 2018/19 2017/18
Class 3
- Weekly flat rate voluntary payment £14.65 £14.25