National Insurance

Question 1

What are the classes

Answer 1

Class 1 - paid by employees (primary) and employers (secondary)

Class1A - paid by employees only

Class 2- paid by the self employed

Class 3 - voluntary

Class 4- paid by the self employed

Question 2

Class 1 primary

Answer 2

Percentage based payable by employees earning £242 or more

Based on gross earnings excluding benefits in kind, redundancy payments

Question 3

Class 1 secondary

Answer 3

Percentage based contribution payable by employers no upper earnings limit

No employer contribution on under £175 a week or under 21 or under 25 on a apprentice scheme

Question 4

Employment allowance

Answer 4

Employers can offset an employment allowance of up to £5000 from their employers secondary class 1 national insurance

Question 5

Class 1A

Answer 5

Is an employers only liability payable on taxable benefits

Payable in arrears by 19th July following the end of the tax year

Question 6

Class 2

Answer 6

Payable by the self employed except those under 16 or over state pension age at a flat rate of £3.45 per week

Small earning exception of £6725

Question 7

Class 3

Answer 7

Payable as voluntary contributions by those not otherwise Liable to pay but only to maintain a contribution record for basic state retirement pension at a flat rate of £17.45

Question 8

Class 4

Answer 8

Payable by the self employed at 9% on income from trade profits on profits between £11,908 and £50,270 and 2% on excess over £50,270