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HMRC internal manual

National Insurance Manual

Class 4 NICs: structure from 6 April 2003: married women and widows with reduced rate elections

NIM24033 explains the changes to the structure of Class 4 NICs from 6 April 2003 provided by amendments to section 15, SSCBA 1992 and introduced as part of National Insurance Contributions Act 2002 (NIA 2002).

NI Act 2002 made no changes to the rules covering the payment of Class 4 NICs by those married women and widows who are self-employed and who have a valid reduced rate election.

This means that from 6 April 2003 those married women and widows with a valid reduced rate election will pay Class 4 NICs:

  • at the main Class 4 NICs percentage on so much of their profits or gains for a tax year as:

    • exceeds the Lower Profits Limit (LPL) but
    • does not exceed the Upper Profits Limit (UPL) and
  • the additional Class 4 NICs percentage on so much of their profits or gains as exceeds the UPL.

For the tax year from 6 April 2003 to 5 April 2011:

  • the main Class 4 NICs percentage is 8% and
  • the additional Class 4 NICs percentage was 1%

For the tax years from 6 April 2011 onwards:

  • the main Class 4 NICs percentage is 9% and
  • the additional Class 4 NICs percentage is 2%

General guidance on married women and widows NI liability can be found at NIM30000 onwards.