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National Insurance Contributions — Thresholds

Class 1 — Employee and employer

2019/20 2018/19
Earnings Weekly Monthly Annual Weekly Monthly Annual
Lower Earnings Limit (LEL) £118 £512 £6,136 £116 £503 £6,032
Earnings Threshold(ET)
- Primary Threshold (PT) £166 £719 £8,632 £162 £702 £8,424
- Secondary Threshold (ST) £166 £719 £8,632 £162 £702 £8,424
Upper Secondary Threshold (UST) £962 £4,167 £50,000 £892 £3,863 £46,350
Apprentice Upper Secondary Threshold (AUST) £962 £4,167 £50,000 £892 £3,863 £46,350
Upper Earnings Limit (UEL) £962 £4,167 £50,000 £892 £3,863 £46,350
Employment allowance 1 £3,000 £3,000
Apprenticeship levy 2 £15,000 £15,000
  1. The annual employment allowance may be offset against an employer’s Class 1 NICs but must be claimed via the normal payroll process. The allowance is not available to companies of which a director is the sole employee employee, and as part of a reform announced during the 2018 Budget its availability will be restricted to employers whose NIC liability is less than £100,000.
  2. The apprenticeship levy is set at a rate of 0.5% of an employer’s annual pay bill and is collected via PAYE. As the annual allowance is used to offset the payment of the levy, the levy is only paid by employers whose pay bills exceed £3 million per year.

Class 2 and Class 4 — Self employed

Income or profits 2019/20 2018/19
Annual Annual
Class 2
- Small Profits Threshold (SPT) £6,365 £6,205
Class 4
- Small Profits Threshold (SPT) £6,365 £6,205
- Lower Profits Limit (LPL) £8,632 £8,424
- Upper Profits Limit (UPL) £50,000 £46,350

Other classes

Class 1A NICs are paid on amounts reported on Form P11D(b).

Class 1B NICs are paid on earnings included in a PAYE Settlement Agreement and income tax thereon.

Class 3 NICs are paid voluntarily by persons not liable for contributions, or who are excepted from Class 2 NICs or whose contributions are insufficient to qualify for benefits.