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How much Class 4 National Insurance do you pay?

  • 2 min read
  • Last updated 16 Jan 2024

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
  • 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)

🚨From 6 April 2024 (the 24/25 tax year onwards), Class 2 National Insurance is being scrapped. If you’re under the threshold and pay them voluntarily to qualify for benefits, you’ll still be able to do so.

National Insurance calculator – give it a go!

Your situation

Outlined number oneImage of an arrow
Self-employed income
Self-employed expenses
?
How did you make money?

Tax and profit

Outlined number two
  • Total earnings
    £49,000
    £1,000 tax-free Trading Allowance
    ?
  • NI contributions
    £3,795
    Class 2 NI: £164
    Class 4 NI: £3,632
  • Income tax
    £7,086
  • What you’re left with
    £38,119

How your National Insurance contributions are calculated

When you’re self-employed, you have to pay your National Insurance contributions yourself in your annual Self Assessment, together with any income tax you might owe.

National Insurance breakdown

You pay no NI contributions on the first £12,570 that you make.

You will need to pay Class 2 NI worth £164.

You will also have to pay £3,632 (9%) on your income between £12,570 and £48,000.

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 👇

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! 
Wait there’s more… this will cost you just £149, all in! Find out more about our service here.

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