7. National Insurance Flashcards
Why do you pay national insurance?
To qualify for certain state benefits e.g. state pension.
Who pays national insurance?
- Anyone ages 16+
- Anyone earning above £8632 per annum as an employee
- Anyone earning £6,365 per annum as self-employed
What is class 1 national insurance?
Employment NI, it is an expense to both the employer and employee.
Who pays Class 1 Primary NI?
Employees
What are the Class 1 Primary NI rates?
£8632 - £50,000 12%
£50,001 +. 2%
Gross earnings before any allowable deductions.
Who pays Class 1 Secondary NI?
Employers
What are the Class 1 Secondary NI rates?
£8632 +. 13.8% on gross earnings
What is the annual employment allowance and the conditions for qualifying?
Allowance = £3,000
Company must have 2+ employees
Only one allowance per company
Who pays Class 1A NI?
Employers
What is the rate of Class 1A NI?
13.8% on all non-cash benefits.
No upper or lower limit.
