National Insurance threshold: How much can you earn before paying National Insurance?

There are different types of National Insurance, which are known as classes. The type you will pay depends on your employment status and how much income you earn. The most common class is Class 1, in which National Insurance contributions are automatically deducted by your employer, this should be visible on any payslips you have.

How much can you earn before you need to pay National Insurance?

National Insurance contributions are taken from your earned income and help build your entitlement to state benefits such as pensions and maternity allowances.

If you’re an employee, you will need to pay Class 1 National Insurance Contributions (NICs) on your earnings.

In addition, your employer is required to make an additional contribution of 13.8 percent on earnings above £166 a week.

There is no upper limit on an employer’s National Insurance payments.

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On profits below a certain threshold, you can decide not to pay Class 2 contributions, meaning you pay no NI at all.

In this tax year, the minimum threshold for the self-employed is £6,745 up from £6,345 in the year 2019 to 2020.

If your profits exceed £9,500 in the current tax year, you must pay Class 4 contributions as well as Class 2 contributions.

Class 4 NI is classed at nine percent, while earnings of more than £50,000 will require two percent contributions.