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National Insurance Contributions

 

Individuals in employment have to pay National Insurance contributions if they have earnings over a certain amount of money. This amount is called the Earnings Threshold. It changes annually and rates are determined by the Chancellor during his annual budget and is currently £646.00 per month effective April 2013.

Anyone who pays National Insurance contributions builds up a contribution record. Whether or not s/he can claim certain social security benefits will depend on this contribution record.

Class 1 contributions are paid by employees and are deducted from their gross wages by the Salaries Office. Contributions are paid as a percentage of gross wages, up to a certain amount. This amount is called the Upper Earnings Limit. 2% contribution is paid on earnings above this limit currently £3454 per month effective April 2013.

Employees contributing to Universities Superannuation Scheme (USS), Local Government Scheme (LGS), Cardiff University Pension Fund (CUPF) or NHS pension fund Superannuation Schemes will pay National Insurance at the Contracted Out (D) rate of 10.6%. Employees who are not members of the above Superannuation Schemes will pay National Insurance at the Not Contracted Out (A) rate of 12%.

An employee should contact :

HMRC

Phone: (0845) 302 1479
Address:

National Insurance Contributions Office
Deferment Office
Longbenton
Newcastle-upon-Tyne
NE98 1ZZ

 

For further information visit:

HM Revenue and Customs National Insurance

ALTERNATIVE ARRANGEMENTS

If an employee has made alternative arrangements with the Contributions Agency for the payment of National Insurance Contributions, they must advise the Contributions Agency to issue a deferment certificate FORM CA2700 to the Salaries Office. On receipt of this certificate, no primary National Insurance contributions will be deducted.

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