Key facts
- Employee Class 1: 8% between £12,570 and £50,270, then 2% above
- Employer Class 1: 15% on earnings above £5,000 from April 2026
- Self-employed Class 4: 6% on profits £12,570 to £50,270, then 2%
- Full new state pension 2026/27: £221.20 per week (£11,502.40 per year)
Employee National Insurance: Class 1 (Employee Contributions)
Class 1 employee NI contributions apply to all employed workers. The rates for 2026/27:
| Band | Annual Earnings | Monthly Earnings | Rate |
|---|---|---|---|
| Below lower earnings limit | Under £6,396 | Under £533 | 0% (no contributions, no state pension credits) |
| Lower earnings limit to primary threshold | £6,396 to £12,570 | £533 to £1,047.50 | 0% (credits earned, zero cash deduction) |
| Primary threshold to upper earnings limit | £12,570 to £50,270 | £1,047.50 to £4,189.17 | 8% |
| Above upper earnings limit | Over £50,270 | Over £4,189.17 | 2% |
Source: HMRC, National Insurance contributions rates and allowances, 2026/27.
Note: the employee NI rate between the primary threshold and UEL was reduced from 10% to 8% in April 2024. This represented a significant take-home pay increase for most UK workers. The current 8% rate remains in place for 2026/27.
NI on earnings between £12,570 and £35,000 = £22,430 at 8% = £1,794.40 per year (£149.53 per month)
National Insurance Calculator 2026/27
Calculate your exact Class 1 employee NI contributions for 2026/27, including pension contributions and student loan deductions.
Employer National Insurance: Class 1 (Employer Contributions)
From April 2026, employers pay NI at 15% on employee earnings above the secondary threshold of £5,000 per year.
| Parameter | Value |
|---|---|
| Secondary threshold | £5,000 per year / £416.67 per month |
| Upper secondary threshold (apprentices under 25) | £50,270 per year |
| Rate | 15% |
Employer NI is not deducted from employee pay. It is an additional cost to the employer. For a £30,000 salary: Employer NI = (£30,000 minus £5,000) x 15% = £3,750 per year
See the Employer NI Calculator for your business cost per employee.
Self-Employed National Insurance: Class 2 and Class 4
The self-employed pay two different classes of NI:
Class 2: A flat-rate contribution that entitles you to state pension credits and contributory benefits. For 2026/27, Class 2 NI is effectively abolished as a mandatory charge. Self-employed workers with profits above the small profits threshold (£12,570) gain Class 2 NI credits automatically through the self-assessment system at no additional cost. Those with profits below £12,570 can make voluntary Class 2 contributions to protect their state pension record.
Class 4: A percentage contribution on self-employed profits.
| Band | Annual Profits | Rate |
|---|---|---|
| Below lower profits limit | Under £12,570 | 0% |
| Lower profits limit to upper profits limit | £12,570 to £50,270 | 6% |
| Above upper profits limit | Over £50,270 | 2% |
Class 4 NI = (£40,000 minus £12,570) x 6% = £27,430 x 6% = £1,645.80 per year. This is paid through self-assessment in January and July each year.
See the Self Assessment Calculator to estimate your full self-employment tax bill including income tax and Class 4 NI.
How NI Builds Your State Pension
The full new state pension for 2026/27 is £221.20 per week (£11,502.40 per year). To receive the full amount, you need 35 qualifying years of NI contributions. To receive any state pension, you need at least 10 qualifying years.
| NI Qualifying Years | State Pension Received |
|---|---|
| Less than 10 | £0 |
| 10 | Approximately £63.20/week |
| 20 | Approximately £126.40/week |
| 35+ | £221.20/week (full amount) |
A qualifying year is one in which you earn at or above the lower earnings limit (£6,396 for 2026/27) or make voluntary contributions. This includes years of employment, self-employment above the small profits threshold, and certain credits for carers and people on benefits.
Expert Tip
If you have gaps in your NI record (perhaps from years abroad, career breaks, or low earnings), you can buy voluntary Class 3 NI contributions to fill them. For 2026/27, a voluntary Class 3 contribution costs £17.45 per week (£907.40 per year). Each year bought adds approximately £6.32 per week to your state pension for life. At the average UK life expectancy, that represents a significant return on investment. Check your state pension forecast and NI record at gov.uk/check-state-pension.NI Differences From Income Tax
Many people confuse income tax and NI, but they are calculated and collected quite differently:
| Feature | Income Tax | National Insurance |
|---|---|---|
| Cumulative basis | Yes (employee) | No (always per period) |
| Applied on dividend income | Yes | No |
| Applied on savings interest | Yes | No |
| Applied after retirement | Only if still earning | No (stops at state pension age) |
| Annual allowance | £12,570 personal allowance | Primary threshold £12,570 |
| Year-end reconciliation | Yes (P800 or self-assessment) | No (each period stands alone) |
The key practical difference: NI stops at state pension age. If you continue working past the state pension age, you no longer pay employee NI, even if you continue paying income tax on earnings above £12,570.
NI and Salary Sacrifice
Pension contributions made through salary sacrifice reduce employer and employee NI because the sacrifice reduces gross pay. This is why salary sacrifice is more tax-efficient than relief at source pension contributions.
An employee on £40,000 sacrificing £3,000 per year into a pension saves:
- Employee NI: £3,000 x 8% = £240 per year
- Employer NI: £3,000 x 15% = £450 per year
Combined saving: £690 per year, on top of the income tax relief. See the Salary Sacrifice Calculator for your specific figures.
Related Calculators
Frequently Asked Questions
Employees pay 8% on earnings between £12,570 and £50,270, and 2% above that. Employers pay 15% on employee earnings above £5,000. Self-employed workers pay 0% Class 2 (credits granted automatically above £12,570) and 6% Class 4 on profits between £12,570 and £50,270.
Yes. Employee National Insurance stops entirely when you reach state pension age, currently 66. You continue to pay income tax on earnings above the personal allowance, but NI is no longer deducted.
No. Employee NI is calculated independently for each pay period (weekly or monthly), not on a cumulative annual basis. This is a significant difference from income tax.
35 qualifying years of NI contributions (or credits) are required for the full new state pension of £221.20 per week in 2026/27.
Employers pay Class 1 NI at 15% on employee earnings above the secondary threshold of £5,000 per year from April 2026. This is an employer cost and is not deducted from employee pay.
Class 4 NI is charged at 6% on self-employed profits between £12,570 and £50,270, and 2% above £50,270. It is paid through self-assessment alongside income tax.
On a £35,000 salary in 2026/27, employee NI is 8% on earnings between £12,570 and £35,000, which equals £1,794.40 per year (£149.53 per month).
Class 2 NI is set at £0 per week for 2026/27 when profits exceed the small profits threshold of £12,570, with National Insurance credits granted automatically. Below that threshold you can pay Class 2 voluntarily to protect your state pension record.
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James Hartley is a CIMA qualified financial analyst and Founder and Lead Financial Analyst at WhatsUK, with 8+ years in UK tax, payroll, and compliance. He builds every calculator on WhatsUK and authors all editorial content, ensuring every figure is verified against official HMRC sources before publication.
Sources & Official References
- HMRC: NI contributions rates and allowances- Official 2026/27 rates for all classes
- GOV.UK: State pension- Full new state pension £221.20/week
Last verified:
Disclaimer: This calculator provides estimates based on standard HMRC rates for 2026/27. Results may vary based on individual circumstances. This is not financial advice. Always consult a qualified accountant or CIMA-qualified financial adviser for personal tax matters.