Sarah Bradford outlines the National Insurance contributions system for the self-employed and explains what to do if Class 2 contributions are being charged incorrectly.
There are two classes of National Insurance contributions (NICs) which may be of relevance to a self-employed earner – Class 2 and Class 4.
Class 4 NICs are relevant where the self-employed earner has profits equal to or exceeding the small profits threshold. Class 2 NICs, which are voluntary, are only relevant where the self-employed earner’s profits are below the small profits threshold and the earner wants to pay a contribution to secure a qualifying year for state pension and contributory benefits purposes.
Class 4 NICs
Following the abolition of the liability to pay Class 2 contributions from 6 April 2024 onwards, Class 4 contributions became the mechanism by which a self
