How much Class 4 National Insurance do you pay?

Wondering how much Class 4 National Insurance you need to pay? Let’s see if we can help you out there..

What is National Insurance?

Let’s give you a quick rundown of what National Insurance is so you feel a bit better when it comes to paying it. 

You’ll probably be pleased to know that National Insurance goes towards a range of benefits such as:

• The National Health Service (NHS)
• Pension
• Unemployment benefits

National Insurance Contributions (NICs) may be a bit of a pain now, but they do determine how much state pension you’re entitled to when you retire, so it’s worth keeping an eye on your record. 

Although National Insurance is mandatory, you can make voluntary contributions to ensure you secure the full state pension. 

If you ever wondered what the big fuss about having a national insurance number is – well, your NI contributions are recorded against your national insurance number. 

Now this is where it gets a bit techy so listen up! 🔊

National Insurance is slightly different for self-employed and employed people. 

There are 4 different classes:

• Class 1
• Class 2 (this is getting scrapped from 6 April 2024)
• Class 3
• Class… (you guessed it).. 4!

You’ll need to pay Class 4 National Insurance contributions (NICs) if you’re self-employed and earning over £12,570 a year. There’s simply no way around it! 🙅

Most people pay it through their Self Assessment tax return bill (it probably is the easiest way to pay). If you’re unsure how to do this, we’ve covered it step by step in this guide.

How much do I need to pay?

Class 4 National Insurance contributions:

• 9% on profits over £12,570 (which will decrease to 8% from 6 April 2024)
• 2% on profits over £50,270

Class 2 National Insurance contributions:

• Flat rate of £3.45 a week (scrapped from 6 April 2024)

National Insurance calculator – give it a go!

So, how do I pay National Insurance?

Many people don’t know there are actually multiple ways you can pay – have a look at the list below 👇

• Online or telephone banking (same day)
• CHAPS (same day)
• At your bank or building society (same day)
• BACS (takes about 3 working days)
• By cheque through the post to HM Revenue and Customs (also 3 working days)
• Through a Direct Debit (if you have not set one up before, it can take about 21 days)

Are there any other ways?

Of course – TaxScouts! Our accredited accounts can file your self assessment tax return in just 48 hours. National insurance contributions and all! Find out more about our service here.