Government Nic
Government NIC
The employee pays NIC at the default rate (12%) for earnings between Primary Threshold and Upper Earnings Limit, any income over the UEL is charged at the higher rate (2%).
The employer pays NIC at the default rate (13.8%)on all earnings above Secondary Threshold.
NIC BANDS
Lower Earning Limit (LEL)
This is the bottom limit to the start of nic calculation. Although there is no NIC payable at this level, it is used for entitelment to Pension and Statutory payments
Primary Threshold (PT)
Start of nic contributions for the employee.
Secondary Threshold (ST)
Start of nic contributions for the employer.
Upper Earnings Limit (UEL)
This is the top limit to the employee's standard rate. Income above this will be charged at the Higher rate
NIC RATES
Not Contracted Out table
Default rate
Reduced Rate Tables B,E
Eligible married women.
Higher Rate
Rate above UEL
Deferred rate
Those who have a job elsewhere with earnings over UEL.
https://www.gov.uk/national-insurance-rates-letters/contribution-rates
The other pages display the Letters, Bands and Rates
Letter A
Use this Letter for all employees aged 21 to State Pension Age.
On earnings over between PT and UEL they pay the default 12% and the employer pays 13.8%
On earnings over UEL they pay 2% and the employer pays 13.8%
Letter B
Use this Letter for married women or widows
• aged under State Pension Age, and
• who are entitled to pay employee’s contributions at the reduced rate.
For these women, you must have a valid
• form CA4139 or CF383, Certificate of Election, or
• form CF380A, Certificate of Reduced Liability.
On earnings over between PT and UEL they pay the 5.8% and the employer pays 13.8%
On earnings over UEL they pay 2% and the employer pays 13.8%
Letter C
Use this Letter for employees OVER State Pension Age, for whom you hold a valid certificate CA4140 or CF384
On earnings over between PT and UEL they pay the 0% and the employer pays 13.8%
On earnings over UEL they pay 0% and the employer pays 13.8%
Letter J
Employees who can defer National Insurance because they’re already paying it (over UEL) in another job.
On earnings over between PT and UEL they pay the 2% for earnings over UEL and the employer pays 13.8%
On earnings over UEL they pay 2% and the employer pays 13.8%
Letter H
Apprentice under 25, in an approved scheme.
On earnings over between PT and UEL they pay the 12% and the employer pays 0%
On earnings over UEL they pay 2% and the employer pays 13.8%
Letter M
16 and under 21.
On earnings over between PT and UEL they pay the 12% and the employer pays 0%
On earnings over UEL they pay 2% and the employer pays 13.8%
Letter Z
16 and under 21, who can defer National Insurance because they’re already paying it in another job.
On earnings over between PT and UEL they pay the 2% and the employer pays 0%
On earnings over UEL they pay 2% and the employer pays 13.8%
https://www.gov.uk/national-insurance-rates-letters/category-letters
governmentnic 16/12/16
Created with the Personal Edition of HelpNDoc: Single source CHM, PDF, DOC and HTML Help creation