National Insurance Contributions

What Is National Insurance?

(NI) is a system of taxes and related social security benefits in theUnited Kingdom. It was first introduced in 1911, and expanded by the government of Clement Attlee in 1946. The tax component of the system consists of taxes paid by employees and employers on weekly earnings and other benefits-in-kind; the self-employed are taxed based upon profits. Such taxes are said to be National Insurance Contributions (NICs). The benefit component of the system is a number of contributory benefits, that is ones where the claimant's previous contribution record determines the availability and amount of the benefit paid.

When do I start paying National Insurance Contributions?

You must pay Class 1 National Insurance Contributions if:

You work as an employed earner (employee) in the UK,
You are 16 or over and under State Pension age (currently 60 for women, 65 for men), and
Your earnings exceed a prescribed minimum level, known as the Earnings Threshold (ET).

There is no payment of Class 1 National Insurance Contributions on earnings up to the ET. However, once earnings reach the Lower Earnings Limit (LEL), National Insurance Contributions will be treated as having been paid on earnings from the LEL up to and including the ET. This protects the benefit entitlement position of lower earners.

If I become sick - does my employer continue to deduct National Insurance Contributions?

Yes. If your gross pay, including any statutory or other sick pay is above the ET, National Insurance Contributions are due.

What happens if I have more than one job - do both employers have to deduct National Insurance Contributions?

Yes. If you have more than one job with different employers, each employer has to deduct National Insurance Contributions if your gross pay with both or either of them is above the ET.

If you have more than one job with the same employer, your earnings from them may be added together for National Insurance Contributions purposes. If your total gross pay is above the ET, then your employer has to deduct National Insurance Contributions.

You may be able to defer some of your contribution liability if your earnings from separate employment's exceed the Upper Earnings Limit. This may avoid you paying too much National Insurance and will remove the need for a refund.

If I have paid too much National Insurance Contributions, how do I claim a refund?

Apply to:-

HM Revenue Customs
National Insurance Contributions Office
Refunds Group
Benton Park View
Newcastle upon Tyne
NE98 1ZZ

Tell them why you think you have paid too much and enclose any evidence to support your claim, e.g. pay slips and P60s.

What is the difference between Primary and Secondary Class 1 contributions?

The employee pays primary contributions.

The employer pays secondary contributions.

Both are collected by the employer and paid to HM Revenue and Customs via the PAYE system.

How do I change personal details?

Please write to us at:

HM Revenue Customs
National Insurance Contributions Office
Contributor Caseworker
Longbenton
Newcastle upon Tyne
NE98 1ZZ

Please ensure you give your name, address, contact number and your National Insurance number. You should also include birth, marriage, divorce and death certificates that are appropriate to your situation.

I want to request an Age Exemption Certificate

You can either contact our National Insurance Contributions helpline on 0845 302 1479 or write to

HM Revenue Customs
National Insurance Contributions Office
Contributor Caseworker
Longbenton
Newcastle upon Tyne
NE98 1ZZ

Please ensure you give your name, address, contact number and your National Insurance number.

Material from the HM Revenue and Customs Website Crown Copyright