Home / Resources / Tax Helpsheets

Tax Helpsheets

Back to Helpsheets

National Insurance - Your Way Around the Maze

Both self-employed and employed people must pay National Insurance Contributions. Employers also pay. The different classes are as follows:

1. Class 1 primary contributions are paid by employees;
2. Class 1 secondary contributions are paid by employers
3. Class 1A is paid by employers;
4. Class 2 is paid by the self-employed, and voluntarily by employees posted overseas;
5. Class 3 is a voluntary contribution to make up any deficits;
6. Class 4 is paid by the self-employed if they earn enough, but does not provide any entitlement to state benefits.

All rates in this article are for 2025/26.

NIC for Employees

The main rate of employee Class 1 National Insurance contributions is 8% and 2% above the Upper Earnings Limit (UEL).

NICs for Employers

Class 1 secondary contributions for 2025-26 are paid by the employer at the rate of 15% on all the employee's income above £96.01 per week.

The contributions must be paid over to HMRC together with the primary contributions deducted from the employees' salaries, each by the 19th of each month or by 22nd if paying electronically. Employers with small payrolls can elect to pay quarterly.

Class 1A contributions are paid by the employer on most forms of benefits provided to the employee, at the rate of 15% on the value of the benefit provided. Class 1A contributions are paid once a year by 6 July after the tax year end.

Employment Allowance

The Employment Allowance (EA) is available to most businesses and charities to offset against the cost of Employer's class 1 national insurance contributions. This applies to all businesses and employees not just new employees or new businesses.

For 2025/26 the allowance is £10,500 per year, per employer. The EA is restricted to employers whose employer’s NIC liability was below £100,000 in the previous tax year. The Employment Allowance can be claimed for the previous 4 tax years.

Self-Employed NIC

The main rate of Class 4 National Insurance contributions for self-employed people is 6% on profits between £12,570 and £50,270 and 2% on profits over £50,270.

Voluntary National Insurance

You can fill in any gaps you may have in paying NI contributions by paying Class 3.

For 2025/26, the rate is £17.75 per week.

1. Class 1 primary contributions are paid by employees
2. Class 1 secondary contributions are paid by employers
3. Class 1A is paid by employers
4. Class 2 is paid voluntarily by the self-employed with earnings below the Small Profits Threshold of £6,845 for 2025/26, and by employees posted overseas
5. Class 3 is a voluntary contribution to make up any deficits
6. Class 4 is paid by the self-employed if they earn enough, but does not provide any entitlement to state benefits.

How We Can Help You

National Insurance can be a complex area and HM Revenue Customs have wide powers. We can assist you with compliance and taking advantage of NIC planning opportunities.