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HMRC internal manual

National Insurance Manual

Class 2 National Insurance contributions liability: Small earnings from subsidiary self-employment: Administrative concession

A person who was in concurrent Class 1 and Class 2 employment previously did not need to pay Class 2 contributions or apply for SEE (NIM21000) if -

  • Their earnings from Class 1 employment are at or above the Lower Earnings Limit (LEL - See NIM01005); and
  • Their net earnings from self-employment are expected to be £1,300 or less in the tax year.

This was a concession and was not written into legislation. Following the House of Lord’s decision in R v IRC, ex parte Wilkinson [2005] UKHL 30, HMRC reviewed administrative concessions and this one was removed. Any person who is self-employed must register as such and if they have low income from self-employment they should claim SEE (see NIM21000) if they do not want to pay Class 2 contributions.