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National Insurance

National Insurance

Class 1 Employees Employers*
Weekly earnings 2019/2020    
On first £166 Over 21 NIL NIL
  Under 21 NIL NIL
£166.01 to £962 Over 21 12% 13.8%
  Under 21 apprentice 12% NIL
£962.01 and above Over 21 2% 13.8%
  Under 21 2% 13.8%

Class 1A 13.8% NIC on benefits in kind payable on 19th/22nd July after the end of the tax year.
Class 1B 13.8% payable on PAYE Settlement Agreement benefits, tax due 19th/22nd October after the end of the tax year.
Class 2 Self employed flat rate of £3 (£2.95 2018/19) per week.
Class 3 Voluntary contributions at a rate of £15 (£14.62 2018/19) per week.
Class 4 – Self-employed earning rate 2019/20 2018/19
Profits between £8,632 (£8,424) and £50,000 (£46,350) per annum 9% 9%
Profits in excess of £50,000 (£46,350) per annum 2% 2%
* EMPLOYMENT ALOWANCE available from 6 April 2015. Reduction in Employer’s NIC of £3000 (maximum, or limited to actual Employer’s NIC, if lower) for the year.

Apprenticeship Levy: From 6 April 2017, employers will be required to pay the Apprenticeship Levy. The Levy is set at a rate of 0.5% of an employer’s annual pay bill and will be collected through the PAYE system. The pay bill is the total amount of earnings liable to employer’s Class 1 NIC, including earnings below the secondary threshold. Where the age-related secondary percentage of MC is 0% e.g for employees under the age of 21, such earnings are included in calculating the pay bill.

Employers receive an annual allowance of £15,000 to offset against payment of the Levy, and therefore the Levy will be payable only by employers who have to pay bilis in excess of £3million per year. Where two or more companies are connected, the allowance is spread between the companies.

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