National Insurance Contributions
Explanation of terms
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| Class 1 |
Payable in respect of earnings of employees. The employeee pays "primary" contributions and the employer "secondary" contributions |
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| Class 1A |
Due from employer on benefits not collected under Class1 |
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| Class 1B |
Paid by employers on grossed-up value of PAYE settlements |
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| Class 2 |
Self-employeds' weekly contributions |
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| Class 3 |
Voluntary contributions by, say, the unemployed |
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| Class 4 |
Self-employeds' main contributions paid with Schedule D, Case 1 |
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| Contracted Out |
Where employers choose to make other arrangements for their employees' earnings-related pensions they can contract out of the state second pension (S2P) scheme (formerly SERPS) |
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2009-10
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2008-09
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2007-08
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Annual |
Weekly |
Annual |
Weekly |
Annual |
Weekly |
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|
£ |
£ |
£ |
£ |
£ |
£ |
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Class 1
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Lower earnings' limit
|
4,940 |
95 |
4,680 |
90 |
4,524 |
87 |
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Earnings' threshold
|
5,720 |
110 |
5,460 |
105 |
5,200 |
100 |
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Upper earnings' limit
|
43,888 |
844 |
40,040 |
770 |
33,840 |
670 |
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Upper accruals point
|
40,040 |
770 |
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Employer
|
Employee
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Employer
|
Employee
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Employer
|
Employee
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% |
% |
% |
% |
% |
% |
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|
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Not contracted out to UEL
|
12.8 |
11.0 |
12.8 |
11.0 |
12.8 |
11.0 |
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Not contracted out above UEL
|
12.8 |
1.0 |
12.8 |
1.0 |
12.8 |
1.0 |
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Married women's reduced rate to UEL
|
12.8 |
4.85 |
12.8 |
4.85 |
12.8 |
4.85 |
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Married women's reduced rate above UEL
|
12.8 |
1.0 |
12.8 |
1.0 |
12.8 |
1.0 |
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Contracted out - salary related
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standard
|
9.3 |
9.4 |
9.3 |
9.4 |
9.3 |
9.4 |
|
over upper earnings limit
|
12.8 |
- |
12.8 |
- |
12.8 |
- |
|
rebate between lower earnings' limit and earnings' threshold
|
3.7 |
1.6 |
3.7 |
1.6 |
3.5 |
1.6 |
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Contracted out - money purchase
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standard
|
11.8 |
- |
11.8 |
- |
11.8 |
- |
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over upper earning's limit
|
12.8 |
- |
12.8 |
- |
12.8 |
- |
|
rebate between lower earnings' limit and earnings' threshold
|
1.4 |
- |
1.0 |
- |
1.0 |
- |
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Class 1A
|
12.8 |
12.8 |
11.8 |
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Class 1B
|
12.8 |
12.8 |
11.8 |
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Class 2
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Normal rate
|
£2.40pw |
£2.30 pw |
£2.20 pw |
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Share fisherman
|
£3.05 |
£2.95 pw |
£2.85 pw |
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Volunteer development workers
|
£4.75 |
£4.50 pw |
£4.35 pw |
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Small earnings exception
|
£5,075pa |
£4,825 pa |
£4,635 pa |
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Class 3
|
£12.05 |
£8.10 pw |
£7.80 pw |
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Class 4
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Percentage rate
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8.0 |
8.0 |
8.0 |
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Annual lower earnings' limit
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£5,715 |
£5,435 |
£5,225 |
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Annual upper earnings' limit
|
£43,875 |
£40,040 |
£34,840 |
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Above upper earnings' limit
|
1.0 |
1.0 |
1.0 |
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