National Insurance

As an employer you are required by law to operate the National Insurance Contributions (NICs) system accounting for your own and employees contributions. This is normally done through the Pay As You Earn (PAYE) system.

 You may have to deduct Class 1 NIC from your employees. You may also have to pay Class 1A and Class 1B NIC after the end of the tax year. The following categories of NI may apply:

 Class 1:   Paid by people who work as employed earners, and their employers.

 

Class 1A: Paid by employers who provide certain directors and employees with benefits in kind which are available for private use, for example, cars and fuel.

 

 Class 1B:  Paid only by employers who enter into a Pay As You Earn (PAYE) Settlement Agreement (PSA) with HM Revenue and Customs for tax purposes.

  • National insurance for people going abroad

    Special rules mean that people often have to pay National Insurance contributions when they work overseas. These rules can help them to remain in the UK’s Social Security system when they go abroad. In many countries, where you continue in the UK scheme, you can be exempt from foreign Social Security contributions.  When you are no [...]

  • National insurance for people coming to the UK

    When you come to work in the UK you have to register for a National Insurance number and immediately start paying National Insurance contributions in the UK on the same basis as other people who normally live and work here. If you are employed by a UK employer or are attached or seconded to a host [...]

  • NI for employers having employees from abroad

    Liability for Class 1 National Insurance contributions Liability for Class 1 National Insurance contributions occurs if a person works: in the UK under a contract of service or in an office with income taxable as employment income Class 1 NI is made up of two parts – primary contributions payable by the employee and secondary contributions payable by the [...]

  • NI rules for working in the EU

    From 1 May 2010 there are new rules which may affect workers who work around EU member states. The basic rule in EU Regulations The basic rule in the current Regulations is that people are subject to the social security legislation of the Member state where they carry on their work. They pay their contributions only to [...]

  • NI rules when working in 2 EU countries

    Employed persons: activities in two or more Member states Current Regulations 1408/71 and 574/72 Key Points:- There are special rules that determine which Member state’s social security legislation applies if an employee has a pattern of normally working in two or more other Member states. The current rules for people normally working in two or more Member states [...]