Income Tax - NIC (National Insurance Contribution) & ISA

Question 1

What is National Insurance Contribution

Answer 1

You pay NIC to qualify for certain benefits including the state pension. It applies if you are between 16y and 65y earning more than $8060 annually and for self-employed $5965 annually.

Question 2

What are the types of NIC’s?

Answer 2

Here are the types of NIC’s

1. Class 1 P (Employees)
2. Class 1 S, Class 1A (Employers)
3. Class 2 and Class 4 (Self-employed)

Question 3

1. Class 1 Primary paid by?
   What are the rates?
2. Class 1 Secondary paid by?
   What are the rates?
3. Class 1A paid by?

Answer 3

Paid by employees

Rates are
Between 8060-43000 12%
43,000 and above 2%

Paid by employers

Rates are
8,112 and above 13.8%

Paid by employers
For non-cash benefits at the rate of 13.8%

Question 4

4. Class 2 paid by?
   What are the rates?
5. Class 4 paid by?
   What are the rates?

Answer 4

4. Paid by self-employed
5. 80 a week above 5,965
6. Paid by self employed
   8,060-43,000 at the rate of 9%
   43,000 and above at the rate of 2%