National Insurance

Question 1

What 3 types of national insurance are there? (for PTax)

Answer 1

• Class 1 Primary
• Class 1 Secondary
• Class 1A

Question 2

Who pays Class 1 Primary National Insurance and at what rate?

Answer 2

Employee pays at 12% for earnings between the primary threshold (£8,060) and upper earnings limit (£43,000), 2% on earnings above.

Question 3

Who pays Class 1 Secondary National Insurance and at what rate?

Answer 3

Employer pays 13.8% on all earnings above the secondary threshold (£8,112) - no upper limit.

Question 4

Who pays Class 1A National Insurance and at what rate?

Answer 4

Paid by employer on cash value of non-cash benefits at a rate of 13.8%.

Question 5

How do directors pay National Insurance?

Answer 5

On a cumulative basis.

Question 6

What is the employment allowance and how much is it?

Answer 6

£3,000 Maximum
Employer can make a claim to reduce total Class 1 secondary contributions by an employment allowance equal to those contributions.