National Insurance Contributions — Thresholds
Class 1 — Employee and employer
| 2021/22 | 2020/21 | |||||
|---|---|---|---|---|---|---|
| Earnings | Weekly | Monthly | Annual | Weekly | Monthly | Annual |
| Lower Earnings Limit (LEL) | £120 | £520 | £6,240 | £120 | £520 | £6,240 |
| Earnings Threshold(ET) | ||||||
| - Primary Threshold (PT) | £184 | £797 | £9,568 | £183 | £792 | £9,500 |
| - Secondary Threshold (ST) | £170 | £737 | £8,840 | £169 | £732 | £8,788 |
| Upper Secondary Threshold (UST) | £967 | £4,189 | £50,270 | £962 | £4,167 | £50,000 |
| Apprentice Upper Secondary Threshold (AUST) | £967 | £4,189 | £50,270 | £962 | £4,167 | £50,000 |
| Upper Earnings Limit (UEL) 1 | £967 | £4,189 | £50,270 | £962 | £4,167 | £50,000 |
| Employment allowance 2 | £4,000 | £4,000 | ||||
| Apprenticeship levy 3 | £15,000 | £15,000 | ||||
- The UEL, along with the UST and AUST, will remain aligned with the UK higher rate tax threshold, at £50,270, until April 2026.
- The annual employment allowance may be offset against an employer’s Class 1 NICs but must be claimed via the normal payroll process. The allowance is not available to companies of which a director is the sole employee, and is restricted to employers whose NIC liability is less than £100,000.
- The apprenticeship levy is set at a rate of 0.5% of an employer’s annual pay bill and is collected via PAYE. As the annual allowance is used to offset the payment of the levy, the levy is only paid by employers whose pay bills exceed £3 million per year.
Class 2 and Class 4 — Self employed
| Income or profits | 2021/22 | 2020/21 |
|---|---|---|
| Annual | Annual | |
| Class 2 | ||
| - Small Profits Threshold (SPT) | £6,515 | £6,475 |
| Class 4 | ||
| - Small Profits Threshold (SPT) | £6,515 | £6,475 |
| - Lower Profits Limit (LPL) | £9,568 | £9,500 |
| - Upper Profits Limit (UPL) 1 | £50,270 | £50,000 |
- The UPL will remain aligned with the UK higher rate tax threshold, at £50,270, until April 2026
Other classes
Class 1A NICs are paid on amounts reported on Form P11D(b).
Class 1B NICs are paid on earnings included in a PAYE Settlement Agreement and income tax thereon.
Class 3 NICs are paid voluntarily by persons not liable for contributions, or who are excepted from Class 2 NICs or whose contributions are insufficient to qualify for benefits.