If you're employed

If you're employed you pay Class 1 National Insurance contributions. The rates are:

· if you earn more than £139 a week and up to £817 a week, you pay 12 per cent of the amount you earn between £139 and £817

· if you earn more than £817 a week, you also pay 2 per cent of all your earnings over £817

You pay a lower rate if you're a member of your employer's contracted-out pension scheme.

Your contributions are deducted from your wages by your employer.

If you're self-employed

If you're self-employed you pay Class 2 and Class 4 National Insurance contributions. The rates are:

· Class 2 National Insurance contributions are paid at a flat rate of £2.50 a week

· Class 4 National Insurance contributions are paid as a percentage of your annual taxable profits - 9 per cent on profits between £7,225 and £42,475, and a further 2 per cent on profits over that amount

If your profits are expected to be less than £5,315 you may not have to pay Class 2 National Insurance contributions.

From April 2011, your Class 2 National Insurance contributions payments will become due on 31 January and 31 July, the same as a Self Assessment tax bill. You pay Class 2 National Insurance contributions either monthly or six monthly by Direct Debit – follow the first link below for more information about payment dates.

You pay Class 4 National Insurance contributions when you pay your Income Tax.

Voluntary National Insurance contributions

You can pay voluntary contributions (usually Class 3 National Insurance contributions) at a flat rate of £12.60 a week.

Class 3 voluntary contributions are paid either monthly by Direct Debit or by quarterly bill. But if you have gaps in your National Insurance contributions record you can make one-off payments of voluntary contributions to fill these.

Date: 2015-01-29; view: 841