National Insurance (NI) is the second largest deduction from most UK workers' pay packets after income tax. Unlike income tax, NI has different rules for employees, employers, and the self-employed, and the thresholds do not align neatly with income tax bands. This guide explains exactly how much you pay in 2025-26.
Employee Class 1 NI: the main rate
| Earnings (annual) | NI rate |
|---|---|
| Up to £12,570 (Lower Earnings Limit / Primary Threshold) | 0% |
| £12,571 to £50,270 (Upper Earnings Limit) | 8% |
| Above £50,270 | 2% |
Note: these rates were reduced in April 2024 (from 12% and 2%) and again for 2025-26. Always check the latest rates with HMRC.
How much NI do I pay? Examples
| Annual salary | NI payable (annual) | NI per month |
|---|---|---|
| £20,000 | £596 | £49.67 |
| £30,000 | £1,394 | £116.17 |
| £40,000 | £2,194 | £182.83 |
| £50,270 | £3,016 | £251.33 |
| £60,000 | £3,211 | £267.58 |
| £80,000 | £3,611 | £300.92 |
Calculation for £30,000: (£30,000 - £12,570) × 8% = £17,430 × 8% = £1,394.40 per year.
Employer NI: what your employer pays on top
Employers pay Class 1 Secondary NI on top of your salary, this is a cost to your employer but does not reduce your take-home pay directly. From April 2025, employer NI is:
- 0% on earnings up to £5,000 (Secondary Threshold, reduced from £9,100 in April 2025 Budget)
- 15% on earnings above £5,000
On a £30,000 salary, employer NI is approximately £3,750, a significant employment cost that affects hiring decisions and salary negotiations.
Self-employed NI: Class 4
Self-employed individuals pay Class 4 NI (not Class 1) through Self Assessment:
- 6% on profits between £12,570 and £50,270
- 2% on profits above £50,270
Class 2 NI (previously a flat £3.45 a week) has not been payable since April 2024 if your profits are at or above the Small Profits Threshold (£6,845 in 2025-26): contributions are treated as paid, so your NI record is protected. If profits fall below that threshold, you can pay voluntary Class 2 (£3.50 a week in 2025-26) to protect State Pension entitlement.
Frequently asked questions
Does NI affect my State Pension?
Yes. You need 35 qualifying years of NI contributions to receive the full new State Pension (£230.25/week in 2025-26). A qualifying year requires earnings above the Lower Earnings Limit (£6,500/year in 2025-26). You can check your NI record via your HMRC personal tax account.
Do I pay NI after State Pension age?
No. Once you reach State Pension age, you stop paying employee NI contributions, even if you continue working. Your employer, however, continues to pay employer NI on your wages.
Why is my NI different from my colleague's at the same salary?
NI is calculated on a pay-period basis rather than annually (unlike income tax). If your earnings fluctuate, for example, due to bonuses, overtime, or irregular pay, your NI in any given month may be higher or lower than a simple annual calculation would suggest.