Chapter 8 - 1.3 - Class 4 NICs Flashcards
1
Q
How are contributions calculated?
A
On the tax adjusted trading profits for the tax year
2
Q
What are the three rates?
A
- 0% on profits up to £12,570
- 9% on profits between £12,571 and £50,270
- 2% on profits over £50,270
3
Q
What is the low profits rate?
A
- 0% on profits up to £12,570
4
Q
What is the middle profits rate?
A
- 9% on profits between £12,571 and £50,270
5
Q
What is the high profits rate?
A
- 2% on profits over £50,270
6
Q
When must a trader register with HMRC for class 4 NICs and income tax purposes by?
A
By the 5th of October following the end of the tax year
7
Q
What should you remember when calculating NICs?
A
Round to the nearest pound at each stage of your workings
