National Insurance threshold increase 2020/21

National Insurance threshold increase 2020/21

From 6th April 2020, the threshold for national insurance is increasing.

The new threshold will be £9,500 and will apply to both the self-employed as well as employees.

For the self-employed, you pay class 4 national insurance contributions at 9% above the threshold on up to £50,000 a year. (In addition to flat rate class 2 contributions every week.)

For employees, you pay class 1 national insurance contributions at 12% above the threshold on up to £50,000 a year.

Both the self-employed and employees also pay 2% national insurance on profits or income respectively above £50,000 a year.

These increases in the threshold are expected to save the self-employed £78 a year, and employees £104 a year.

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