Spring Budget 2011

National insurance contributions

Class 1 (Employees) Not Contracted out of State Second Pension S2P
2011/12 2010/11
Employee: Employee:

No NICs where earnings
are up to £139 a week
12% NICs on £139.01-£817 a week
2% NICs over £817 a week

No NICs where earnings
are up to £110 a week
11% NICs on £110.01-£844 a week
1% NICs over £844 a week
Employer: Employer:

No NICs on the first £136 a week
13.8% NICs over £136 a week

No NICs on the first £110 a week
12.8% NICs over £110 a week
   
Earnings limit or threshold 2011/12 2010/11
  Weekly Monthly Annual Weekly Monthly Annual
£ £ £ £ £ £
Lower limit (LEL) 102 421 5,044
97 421 5,044
Primary earnings threshold
139 602 7,225 110 476 5,715
Secondary earnings threshold 136 589 7,072 110 476 5,715
Upper accrual point 770 3,337 40,040 770 3,337 40,040
Upper limit (UEL) 817 3,540 42,475 844 3,656 43,875
             
Contracted-out S2P rebate 2011/12 2010/11
Reduction on band earnings £102.01-£770 pw £97.01-£770 pw
Employer rate reduction:    
  • Salary-related scheme
3.7% 3.7%
  • Money-purchase scheme
1.4% 1.4%
Employee rate reduction 1.6%
1.6%
     
Class 1A (Employers) 2011/12
2010/11
Most taxable employee benefits 13.8% 12.8%
     
Class 2 (Self-Employed) 2011/12 2010/11
Flat rate £2.50 pw
£130.00 pa
£2.40 pw
£124.80 pa
Small earnings exception
£5,315 pa £5,075 pa
     
Class 4 (Self-Employed) 2011/12 2010/11
On profits £7,225-£42,475 pa
9%
£5,715-£43,875 pa
8%
  Over £42,475 pa
2%
Over £43,875 pa
1%
     
Class 3 (Voluntary) 2011/12 2010/11
Flat rate £12.60 pw
£655.20 pa
£12.05 pw
£626.60 pa

© 23 March 2011. This summary has been prepared very rapidly and is for general information only. The proposals are in any event subject to amendment before the Finance Act is passed. It is recommended you seek competent professional advice before taking any action on the basis of the contents of this publication.