National insurance contributions
The Chancellor announced several future changes to national insurance contributions (NICs):
- From 2011/12, the main and additional rates of employer, employee and selfemployed
NICs will all increase by 0.5%. This is in addition to the 0.5% increase for 2011/12 announced last year. Thus the main employee rate in 2011/12 will be 12% (currently 11%) and the additional rate will be 2% (currently 1%).
- In 2011/12 the primary threshold and lower profits limit for NICs will rise above the previously announced levels by £570.
| Employees |
2010/11 |
| Lowerearnings limit, primary Class 1 |
£97 a week |
| Upper accruals point |
£770 a week |
| Upperearningslimit,primaryClass1 |
£844 a week |
| Primary threshold |
£110 a week |
| Secondary threshold |
£110 a week |
| Employees’ primary Class 1 rate |
11% of £110.01 to £844 a week
1% above £844 a week |
| Employees’ contracted out rebate |
1.6% |
| Married women’s reduced rate |
4.85% |
| Employers’ secondary Class 1 rate |
12.8% on earnings above £110 a week |
Employers ’contracted out rebate,
salary related schemes |
3.7% |
Employers’ contracted out rebate,
money purchase schemes |
1.4% |
| Self employed |
2010/11 |
| Class 2 rate |
£2.40 a week |
| Class 2 small earnings exception |
£5,075 a year |
| Class 3 rate |
£12.05 a week |
| Class 4 rates |
8% of £5,715 to £43,875 a year
1% above £43,875 a year |
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