To eliminate gaps in your NI obligations, you may be allowed to pay voluntary contributions.
Before you can begin paying National Insurance contributions, you must first obtain a National Insurance number.
Can you opt out of National Insurance?
If you are working or self-employed, 16 or older, and earn more than the minimum wage, you cannot opt out.
If you work, your contributions will be withdrawn automatically from your take-home pay, so you won’t be able to opt out.
Do you legally have to pay National Insurance?
If you’re over 16 and earn or have self-employed profits over a specific amount, you’ll have to pay National Insurance contributions. This contributes to your eligibility for benefits like the State Pension and Maternity Allowance.
What happens if I don’t pay national insurance contributions?
Even if you haven’t made enough national insurance contributions, you may still be eligible for benefits. Even if you work or have other sources of income, you can obtain the Basic State Pension if you meet the national insurance requirements.
Who is exempt from NI?
Unless you’re self-employed and make Class 4 contributions, you don’t have to pay National Insurance until you reach State Pension age. When you attain State Pension age, you stop paying Class 4 payments at the conclusion of the tax year.
Does everyone pay National Insurance?
Your National Insurance contributions are determined by your employment status and earnings. Although not everyone is required to pay National Insurance, payments are used to calculate your state pension and other benefits.
You’ll have to pay Class 1 National Insurance contributions if you have a job. If you’re self-employed yet work for an employer, your company is responsible for paying your National Insurance through your payslips, as well as their own 13.8 percent employer payments (15.05 percent from April 2022).
The government stated in September 2021 that, beginning in April 2022, a health and social care charge of 1.25 percentage points would be introduced to UK workers’ National Insurance contributions. For more information, see our news story.
It’s worth checking to see if you’re not required to pay National Insurance. If you are not required to pay National Insurance, you may be eligible for National Insurance credits or make voluntary payments.
Do I need to pay National Insurance if I am unemployed?
Because they are not in paid employment, most people who qualify for National Insurance credits do not contribute to the system.
This could be due to them taking time off to care for children, being unemployed, or being ill.
When you attend an approved training session or serve on a jury, you can earn National Insurance credits.
Class 3 credits apply to your State Pension and bereavement benefits, while Class 1 credits apply to these as well as other benefits (such as Jobseeker’s Allowance or Employment Support Allowance).
Some credits will be applied to your record automatically, while others will require you to apply.
Our table contains a list of some of the most common instances in which you can claim National Insurance credits; however, this list is not exhaustive, so double-check the government’s National Insurance credits website to be sure.
Can I work without NI number?
Employees must pay National Insurance contributions, and you must apply for a National Insurance number if you want to work. The National Insurance Number (NINO) is a one-of-a-kind number that will assist your employer in paying your NI obligations. This number cannot be used by anybody else.
Make your application for your NINO by calling Job Centre Plus at 0800 141 2075.
On the Gov.UK website, you can learn more about how to apply for your National Insurance number.
You don’t need a National Insurance number to begin working, but you will need one after you begin. While you wait for your permanent number, your employer will issue you a temporary number.
Can you claim back National Insurance?
If you are employed or self-employed and are 16 or older but not yet eligible for the state pension, you must pay NIC. The amount of NIC you pay is determined by your income.
The sort of NIC you pay is determined by how you work. Employees and other workers (such as those engaged by agencies) pay different sorts of NIC to self-employed people (that is, those who work for themselves).
Even if you continue to work, you stop paying NIC when you reach state pension age. The self-employed must pay Class 4 NIC until the start of the tax year following the year in which they attain state pension age.
You pay National Insurance on earnings, such as wages and profits from self-employment, but not on pension income.
You may use the GOV.UK calculator to figure out when you’ll be eligible for a state pension.
I am a student. Do I have to pay National Insurance contributions?
Students, especially overseas students, are not subject to any particular rules. You will be required to pay National Insurance contributions in the same way as other UK workers. If you need a National Insurance number or have lost yours, see our page How do I get a National Insurance number? for help. A National Insurance number may be included on the reverse of a biometric residency permit for migrants or international students.
What are National Insurance credits?
Even if you are not working, you may be eligible for National Insurance credits in certain circumstances. Some, but not all, entitlements are affected by these. The state pension is the primary benefit they are eligible for.
For the year in which you may be credited, you must be 16 or older and under the age of state pension.
You may be eligible for National Insurance credits in a variety of situations, including being unable to work due to illness or caring for someone else.
National Insurance credits are divided into two categories: Class 1 credits and Class 3 credits. The type of credit you may be eligible for is determined by your specific circumstances. To get National Insurance credits, you must meet specific requirements.
National Insurance credits should be given automatically in some cases, such as if you receive employment and support allowance or carer’s allowance. In other cases, you’ll have to file a claim.
GOV.UK has more information on the many situations in which you can be eligible for National Insurance credits, as well as how to apply for National Insurance credits.
Adult Specified Credits (also known as babysitting or grandparent’s credits) are discussed on a separate page.
What benefits do my contributions pay for?
To be eligible for various UK government benefits, you must have paid a particular amount of National Insurance Contributions (NIC). Contributory benefits are a type of governmental benefit. National Insurance credits will apply toward these contributory benefits in some situations, but not in others. On GOV.UK, you should carefully review the eligibility requirements. Many benefits rely on the payment (or credit) of enough NIC to generate a qualifying year.
Other benefits are available regardless of whether or not you have paid any or enough NIC, as long as the requirements for claiming apply to you.
To figure out which type of donation goes toward which benefit, look at the table below:
There are several exceptions to the aforementioned, such as share fishermen and volunteer development workers who work in other countries.
Contributions to Class 4 National Insurance do not count toward any state benefits.
What are Class 1 National Insurance contributions?
If you work for an employer, or if you are an employee, you must pay Class 1 NIC. Before paying you, your company deducts the NIC from your wages. Your company is also required to pay NIC on your earnings, but you do not have to be concerned about this.
In the employment section, there is full information about Class 1 NIC, including instances.
What are Class 2 National Insurance contributions?
If you are self-employed, you must pay Class 2 NIC. Our self-employment section has more information.
The Self Assessment system is how HMRC collects Class 2 NIC. This means you are exempt from paying contributions during the tax year. Your liability will become due at the end of the tax year, and you will be able to pay it with your Self Assessment tax bill.
If you are self-employed and subject to Class 2 NIC, you must ensure that you are both registered for Self Assessment and registered for Class 2 NIC on HMRC’s systems. If you fill out form CWF1 when you start your own business, this should happen immediately.
HMRC may automatically reject your Class 2 NIC if you submit self-employed profits on a Self Assessment tax return without completing a form CWF1 since they have no record of your liability. In this situation, you should call HMRC at 0300 200 3500 to request a correction.
In some conditions, persons who are working (or self-employed) overseas can additionally pay Class 2 NIC. Please read our migration section for further details.
What is the Small Profits Threshold?
If you’re self-employed and your profits fall below a certain threshold (the Small Profits Threshold), you won’t have to pay Class 2 NIC. The limit for 2021/22 is £6,515.
What are Class 3 National Insurance contributions?
You can pay Class 3 NIC if you do not pay either Class 1 or Class 2 NIC and do not obtain National Insurance credits, but you want to maintain your rights to particular state benefits. Donations that are made voluntarily are also known as voluntary contributions.
Class 3 NIC can be paid by monthly Direct Debit or quarterly payment request for the current year. You can make a one-time payment for previous years’ contributions.
What are Class 4 National Insurance contributions?
If you are self-employed, you must pay Class 4 NIC. Class 4 NICs are paid in addition to Class 2 NICs, but they do not count toward any state benefits.
Only if your profits exceed a particular threshold, known as the Lower Profits Limit, are you required to pay Class 4 NIC. For 2021/22, this is £9,568.
You must pay Class 4 NIC in addition to any self-assessment income tax.
How do I pay National Insurance contributions?
Under the PAYE system, you pay Class 1 NIC on your wages. Your employer deducts Class 1 NIC and any income tax owed from your gross wages before deductions, and gives you the net amount after deductions.
Self Assessment allows you to pay Class 2 NIC along with the income tax payable on your self-employment profits. Alternatively, you can use a Budget Payment Plan to make payments on a regular basis during the tax year.
HMRC is known to refuse Class 2 NIC payments if they are not correctly registered as being payable (see above).
You can pay Class 3 NIC by quarterly bill or monthly Direct Debit for the current year.
Self Assessment is how you pay Class 4 NIC and the income tax payable on your self-employment profits. See How do I pay tax on self-employed income? for additional information.
How do I claim a refund of overpaid or incorrectly paid National Insurance contributions?
The total amount of NIC you must pay in a tax year is limited (across different classes of contribution). If you’ve only had one job, you shouldn’t have overpaid NIC. However, if your total earned income exceeds the weekly upper earnings limit multiplied by 53 (£967 x 53 = £51,251 in 2021/22), you may have overpaid National Insurance Contributions.
The NIC of each individual is not reconciled by HMRC. This is due to the fact that paying the incorrect amount of NIC is relatively unusual.
- You continued to work after reaching state pension age, and your employer continued to deduct Class 1 National Insurance Contributions;
- You paid Class 4 NIC on self-employment profits in a tax year after the one in which you achieved state pension age;
- When your earnings were below the Small Profits Threshold limit, you paid Class 2 NIC as a self-employed individual;
- You were both employed and self-employed at the same time, and you paid Class 1, Class 2, and Class 4 National Insurance contributions.
You cannot get a NIC refund if you stop working or do not work for the entire tax year.
Simply because you are leaving the UK to reside in another country does not entitle you to a NIC refund. Visit the migration area for further details.
How do I check my National Insurance contributions record?
HM Revenue & Customs (HMRC) keeps track of how much NIC people pay. You can look up your NIC record by going to:
- contacting HMRC’s National Insurance Enquiries Helpline (information available on GOV.UK);
How many years NI contributions are needed for a full pension?
A ‘qualifying year’ is a tax year (April to April) in which you paid enough National Insurance Contributions (NICs) or were credited with enough NICs to make that year qualify for your Basic State Pension.
To be eligible for the full basic State Pension, you must have 30 years of National Insurance Contributions or credits. This indicates that you were either:
- obtaining National Insurance Credits, such as for unemployment, illness, or as a parent or caregiver
Can I stop paying NI after 35 years?
Even if you’re still working, you stop paying Class 1 and Class 2 payments once you reach State Pension age.
You’ll continue to make Class 4 payments until you reach State Pension age at the conclusion of the tax year in which you turn 65.
For example, suppose you turn 65 on September 6, 2021. You’ll stop making Class 4 contributions on April 5, 2022, and pay your final Class 4 bill, together with your income tax, by January 31, 2023.