Class 2 National Insurance
What is Class 2 National Insurance ?
This is our Class 2 National Insurance Guide
Self-Employed people normally have to pay Class 2 NI contributions.
For the tax year 2020/21 (6/4/20 to 5/4/21) the Class 2 NI is a single payment £158.60 for the year. However, if your earnings are below £6,475 per year (see below) you might not need to pay. Class 2 NI does not vary with profit.
In certain circumstances you may be exempt.
HMRC had planned to abolish Class 2 contributions from 6 April 2019, but these plans have been postponed.
Class 2 NI Small Profits Threshold (SPT)
If your business profits are below £6,475 per year (2020/21) you might not need to pay Class 2 NI.
First Year as Self Employed
Class 2 NI is calculated on a weekly basis. So if you started your practice after qualifying in 2020, you would only need to pay Class 2 NI for the period from the start of the practice to 5/4/21 calculated at £3.05 per week.