1. Contribution rates

An employee’s Class 1 National Insurance is made up of contributions:

  • deducted from their pay (employee’s National Insurance)
  • paid by their employer (employer’s National Insurance)

The amounts deducted and paid depend on the employee’s earnings and National Insurance category letter.

Employees and their employers pay less National Insurance if they’re in a contracted-out pension scheme. Both get a rebate if the employee’s earnings are £112 to £155 a week (£486 to £672 a month).

Employee National Insurance rates

This table shows how much employers deduct from employees’ pay for the 2015 to 2016 tax year.

Category letter £112 to £155 a week (£486 to £672 a month) £155.01 to £770 a week (£672 to £3,337 a month) £770.01 to £815 a week (£3,337 to £3,532 a month) Over £815 a week (£3,532 a month)
A 0% 12% 12% 2%
B 0% 5.85% 5.85% 2%
C N/A N/A N/A N/A
D 1.4% rebate 10.6% 12% 2%
E 0% 5.85% 5.85% 2%
J 0% 2% 2% 2%
L 1.4% rebate 2% 2% 2%

Employer National Insurance rates

This table shows how much employers pay towards employees’ National Insurance for the 2015 to 2016 tax year.

Category letter £112 to £156 a week (£486 to £676 a month) £156.01 to £770 a week (£676 to £3,337 a month) Over £770 a week (£3,337 a month)
A 0% 13.8% 13.8%
B 0% 13.8% 13.8%
C 0% 13.8% 13.8%
D 3.4% rebate 10.4% 13.8%
E 3.4% rebate 10.4% 13.8%
J 0% 13.8% 13.8%
L 3.4% rebate 10.4% 13.8%

Employer rates for employees under 21

There are different employer contribution rates for employees under 21.

Category letter £112 to £156 a week (£486 to £672 a month) £156.01 to £770 a week (£672 to £3,337 a month) £770.01 to £815 a week (£3,337 to £3,532 a month) Over £815 a week (£3,532 a month)
I 3.4% rebate 3.4% rebate 0% 13.8%
K 3.4% rebate 3.4% rebate 0% 13.8%
M 0% 0% 0% 13.8%
Z 0% 0% 0% 13.8%

HM Revenue and Customs (HMRC) has full rates and thresholds for tax years:

You can also use calculators and tables to check employees’ National Insurance.

Class 1A and Class 1B rates

Employers pay Class 1A and 1B National Insurance once a year on expenses and benefits they give to their employees. The rate for the tax year 2015 to 2016 is 13.8%.