What Are National Insurance Classes? (UK 2025/26)

National Insurance contributions (NICs) fund the State Pension, certain benefits, and the NHS. There are several classes, and which ones you pay depends on how you earn your income.

Class 1 — Employees

Employees pay primary Class 1 NICs at 8% on earnings between the primary threshold (£242/week or £12,570/year) and the upper earnings limit (£967/week or £50,270/year). Above the upper earnings limit, the rate drops to 2%. These are deducted automatically through PAYE.

Class 1 — Employers (Secondary)

Employers pay secondary Class 1 NICs at 15% on employee earnings above the secondary threshold (£96/week for 2025/26). There is no upper limit — employer NICs apply on all earnings above this threshold. The rate was increased from 13.8% and the threshold lowered from £175/week at the October 2024 Budget.

Class 2 — Self-Employed

Class 2 NICs are flat-rate contributions paid by self-employed people earning above the small profits threshold. They provide access to the State Pension and certain benefits. From 2024/25, most self-employed people no longer need to pay Class 2 NICs, though they can still do so voluntarily.

Class 4 — Self-Employed (Profits)

Class 4 NICs are charged at 6% on profits between £12,570 and £50,270, and at 2% above £50,270. These do not build up benefit entitlement — they are purely a tax on profits.

Class 3 — Voluntary

Class 3 contributions allow you to fill gaps in your National Insurance record to protect your State Pension entitlement. The rate is £17.75 per week for 2025/26.