We sort your Self Assessment for you. £169, all in.

Fast, effortless and 100% online.  Learn more

We sort your Self Assessment for you. £169, all in.

National Insurance (NI)

  • 2 min read

National Insurance (NI) is a contribution paid to HMRC by employees, their employers, and the self-employed. The purpose of National Insurance is to qualify people for certain provided benefits such as the State Pension.

Who pays National Insurance?

You’ll pay the tax if you’re 16 or over and are either:

  1. In employment and are earning above £242 a week
  2. Self-employed and making a profit of £12,570 a year (from 2024/25)

Employers also pay National Insurance for their employees who earn over £242 per week.

Once you reach the state pension age, you don’t need to pay NI at all. 

The National Insurance classes

Different taxpayers pay different kinds of National Insurance, called ‘classes.’

NI class Who pays? How? How much is it?
Class 1 Employees earning more than £242 per week who are under State Pension age a year Your employer deducts it through PAYE 10% (or 2% if you earn over £262 a week)
Class 1A or 1B Employers Your employer pays it on top of your Class 1 14.53%
Class 2 Self-employed people earning over £6,725 a year until 2024/25 Through a Self Assessment tax return Flat £3.45 per week (scrapped from 6 April 2024)
Class 3 Voluntary contributions – you can pay them to fill gaps in your NI record Through a Direct Debit £17.45 per week
Class 4 Self-employed people earning over £12,570 a year Through a Self Assessment tax return 6% (or 2% if you earn over £50,270) 

How to pay your contributions

If you’re employed then National Insurance will be automatically deducted from your monthly pay. However, if you’re self-employed, then you need to pay these contributions yourself. This is usually done through your Self Assessment tax return. 

Whether you’re employed or self-employed, it’s important to make sure that you have the right tax code, so that you’re not underpaying or overpaying NI and Income Tax.

TaxScouts Newsletter

Want regular tips from us?

Sign up for important updates, deadline reminders and basic tax hacks sent straight to your inbox.

"*" indicates required fields

This field is for validation purposes and should be left unchanged.