Class 2 National Insurance contributions

Introduction

If you are self-employed you will probably have to pay Class 2 National Insurance contributions (NICs) unless you:

• have a Small Earnings Exception Certificate obtained from HM Revenue & Customs (HMRC)
• are under 16 years of age
• are over state pension age
• are unable to work in certain circumstances, whether or not you're receiving benefit

Class 2 NICs are payable at a flat weekly rate which you can pay monthly by direct debit or by quarterly bill. They count towards payments such as the basic state pension, the employment and support allowance, maternity allowance and bereavement benefits.

You must also pay Class 2 NICs if you are self-employed in your spare time, even if you are also paying National Insurance as an employee (Class 1). However, if your Class 1 payments exceed a certain level, you may be able to defer payment of your Class 2 NICs.

This guide explains how to calculate and pay Class 2 NICs, where to get the necessary forms and the penalties if you get things wrong.

Subjects covered in this guide

• Introduction
• Paying Class 2 National Insurance contributions
• Exemptions from Class 2 National Insurance contributions
• Class 2 National Insurance contribution rates

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