Ossmans

Class 4 NICs who is liable?
18/04/2024

Most self-employed people are required to pay Class 4 National Insurance contributions (NICs) if their profits are £12,570 or more a year.

Class 4 NIC rates for the tax year 2024-25 are 6% (2023-24: 9%) for chargeable profits between £12,570 and £50,270 plus 2% on any profits over £50,270.

A number of categories of people are exempt from paying Class 4 NICs, these include:

  • People under the age of 16 at the beginning of the year of assessment.
  • People over State pension age at the beginning of the year of assessment. A person who attains State pension age during the course of the year of assessment remains liable for Class 4 NICs for the whole of that year.
  • Trustees, guardians etc of an incapacitated person are exempted from Class 4 NICs on that income.

The Class 4 NIC rate is lower than the corresponding rate for employees who pay National Insurance at 8% on the same income levels. Both the employed and self-employed pay 2% National Insurance contributions on income above the higher rate threshold.


NEWSLETTER

With our newsletter, you automatically receive our latest news by  e-mail and get access to the archive including advanced search options!

Newsletter Sign UpLogin

Affiliations

CONTACT US

Ossmans Limited
591 London Road
North Cheam
Surrey
SM3 9AG

Tel: 020 8330 7711
Fax: 020 8330 6226
Email: mail@bremakumars.com