National insurance contributions & rates

Class 1 (not contracted out)	Employer	Employee
Lower earnings limit		£102
Payable on weekly earnings
£136.01 - £139	13.8%	Nil
£139.01 - £817	13.8%	12%
Over £817	13.8%	2%
Payable on monthly earnings
£589 - £602	13.8%	Nil
£602 - £3,540	13.8%	12%
Over £3,540	13.8%	2%
Men 65 and over and women from the date they qualify for state pension	13.8%	Nil
Employees' contracted-out rebate	1.6%
Married women's reduced rate between £139 and £817	5.85%
Employers' contracted-out rebate, salary-related schemes	3.7%
Employers' contracted-out rebate, money purchase schemes	1.4%

Class 1A (on relevant benefits)	13.8%	Nil

Class 1B (on PAYE settlement arrangement)	13.8%

Class 2 (self employed)	£2.50 per week
Class 2 contributions - share fishermen	£3.15 per week
Class 2 contributions - volunteer development workers	£5.10 per week
Limit of net earnings for exception	£5,315 per annum
Contributions cease at state retirement age
Class 3 (voluntary)	£12.60 per week

Class 4 (* Self employed on profits)
£7,225 to £42,475	9%
Excess over £42,475	2%
*Exemption applies if state retirement age was reached by 6 April 2011.

Maximum contributions
Class 1 or Class 1 & 2	£4,230 + of earnings over £817 p.w.
Class 2 and Class 4	£3,310.30 + of profits over £42,475 a year

Notes

For those earning between £139 per week and £817 per week, employers receive a rebate of 1.4% on contracted out money purchase schemes or 3.7% on contracted out final salary schemes, and employees, a rebate of 1.6% for either scheme.
For children under 16, and employees over state pension age there are no national insurance contributions payable, but employers' contributions remain payable.

Did you know?

That the Government expect to receive £100.7bn from national insurance (2010/11 - £96.5bn)

Easy Accountancy

Easy Accountancy is the UK’s only national specialist accountancy firm for freelancers, sole traders and small businesses

If you’ve just started out as a freelancer or run a small business, you’ll definitely need a small accountant and there are plenty of options out there! However, most accountants will charge you every time you get in touch with them; for every phone call, email or meeting.

We don’t want our clients to be scared to contact us and potentially lose out on valuable tax saving advice. It's even more important when you first start out as you really need to set your business up in the best way possible. As a start up you’ll probably have loads of questions and will really appreciate the fact you can call your accountant as many times as you like without the fear of racking up large bills.

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Provide proactive tax advice throughout the year

We’ve saved our clients up to half on their accountancy bills – if you’d like a quote, click on the quote me button to the right of this page. Alternatively, call us on 0500 234111 / 01442 275767 or email aaron.oneill@easyaccountancy.co.uk

We also have a money-back service guarantee - all of your telephone calls and emails will be answered on the same day, or we will refund your monthly fee (another first within the accountancy world).

To appoint us as your accountants, please fill in our Client Agreement Form online.

If you are a contractor working through a limited company then visit SJD Accountancy (our sister company) who specialise in providing tax advice and accountancy services for Limited Company contractors. You can also keep up to date by following the SJD Accountancy Twitter

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