National Insurance Classes Explained: Class 1, 2, 3 and 4 in 2026/27
Last updated 12 June 2026
National Insurance is split into classes based on how you earn. In 2026/27, employees pay Class 1 at 8% on earnings between £242 and £967 a week, and 2% above that; employers pay a separate 15%. The self-employed pay Class 4 at 6% on profits between £12,570 and £50,270, and 2% above. Class 2 now costs nothing — profits of £7,105 or more are simply treated as paid, protecting your State Pension record. Class 3 voluntary contributions, used to fill gaps in your record, cost £18.40 a week.
- Class 1 (employees): 8% on earnings between £242 and £967 a week (£12,570–£50,270 a year), 2% above — deducted automatically through PAYE (gov.uk).
- Class 1 (employers): a separate 15% on each employee's earnings above £96 a week; eligible employers can knock up to £10,500 off the bill with the Employment Allowance.
- Class 1A/1B: employer-only, 15% on expenses and benefits in kind such as company cars and private health cover.
- Class 2 (self-employed): £0 payable in 2026/27 — profits of £7,105+ (the Small Profits Threshold) are treated as paid; below that you can pay voluntarily at £3.65 a week.
- Class 3 (voluntary): £18.40 a week in 2026/27 — £956.80 to buy a full qualifying year.
- Class 4 (self-employed): 6% on profits between £12,570 and £50,270, then 2%, collected through Self Assessment — the 2026/27 bill is due 31 January 2028.
- You need at least 10 qualifying years on your record to get any new State Pension (gov.uk).
What are the National Insurance classes?
There are four main classes, and which one you pay depends entirely on your employment status. Employees and their employers pay Class 1; the self-employed pay Class 4 (with Class 2 protecting their record at no cost); and Class 3 is a voluntary top-up anyone can use to fill gaps. Paying — or being treated as paying — builds the qualifying years that earn you the State Pension and certain benefits such as Maternity Allowance.
| Class | Who pays it | 2026/27 rate |
|---|---|---|
| Class 1 (primary) | Employees earning over £242/week | 8% then 2% above £967/week |
| Class 1 (secondary) | Employers | 15% above £96/week per employee |
| Class 1A / 1B | Employers, on benefits and expenses | 15% |
| Class 2 | Self-employed | £0 — treated as paid at profits of £7,105+; voluntary £3.65/week below |
| Class 3 | Anyone filling gaps voluntarily | £18.40/week |
| Class 4 | Self-employed with profits over £12,570 | 6% then 2% above £50,270 |
How much is Class 1 National Insurance in 2026/27?
Employees pay 8% on weekly earnings between £242 (the Primary Threshold) and £967 (the Upper Earnings Limit), and 2% on anything above £967 a week. Your employer deducts it through PAYE before your pay arrives, so there is nothing to file. On a £35,000 salary, that works out at 8% of £22,430 — about £1,794 a year.
| Weekly earnings (2026/27) | Employee rate (category A) |
|---|---|
| Up to £129 | 0% — no NI record built |
| £129 – £242 | 0% — but you are treated as building entitlement |
| £242 – £967 | 8% |
| Over £967 | 2% |
Note the second row: earn between £129 and £242 a week from one job and you pay nothing, yet you still qualify for benefits because you are treated as having contributed (gov.uk). That quirk protects part-time workers' State Pension records.
Employers pay their own secondary Class 1 on top — 15% on each employee's earnings above £96 a week in 2026/27. This never comes out of your pay, but it is why the true cost of employing someone is well above their salary, and it is the charge at the centre of most IR35 disputes. Eligible employers can reduce the bill by up to £10,500 a year through the Employment Allowance. Classes 1A and 1B sit alongside: employer-only charges at 15% on expenses and benefits in kind, such as company cars or private medical insurance.
Do the self-employed still pay Class 2 in 2026/27?
Mostly no — and that is a genuine saving, not a record gap. If your profits are £7,105 or more (the Small Profits Threshold), Class 2 contributions are treated as having been paid: you hand over nothing, but your National Insurance record is protected exactly as if you had paid (gov.uk). There is no form to fill in; it happens automatically through your Self Assessment return.
If your profits are below £7,105 — common in the first year of a side hustle — you are not treated as paying, so the year may not count towards your State Pension. You can choose to pay Class 2 voluntarily at £3.65 a week (£189.80 for a full year) to keep the year qualifying. That is one of the better-value deals in the UK tax system, and a reason some low-profit traders register for Self Assessment voluntarily.
Who should pay Class 3 voluntary contributions?
Class 3 is for filling gaps in your record when no other class applies — career breaks, time abroad, or years of low earnings without credits. It costs £18.40 a week in 2026/27, so a full year costs £956.80. You need at least 10 qualifying years to get any new State Pension, and more for the full amount, so a missing year can be expensive in retirement terms (gov.uk).
Two checks before paying a penny. First, view your National Insurance record and State Pension forecast on gov.uk — many gaps make no difference to your final pension, in which case filling them buys nothing. Second, if you are entitled to pay voluntary Class 2 instead (because you were self-employed with low profits), it covers the same year for £3.65 a week rather than £18.40 — roughly a fifth of the cost.
How much is Class 4 National Insurance in 2026/27?
Class 4 is the main charge for the self-employed: 6% on profits between £12,570 (the Lower Profits Limit) and £50,270 (the Upper Profits Limit), then 2% on profits above £50,270 (gov.uk). It is calculated on profit — turnover minus allowable expenses — not on what you invoice.
| Profit (2026/27) | Class 4 due | How it's worked out |
|---|---|---|
| £10,000 | £0 | Below the £12,570 Lower Profits Limit |
| £20,000 | £445.80 | 6% × £7,430 |
| £35,000 | £1,345.80 | 6% × £22,430 |
| £60,000 | £2,456.60 | 6% × £37,700 + 2% × £9,730 |
You pay Class 4 alongside Income Tax through Self Assessment — for 2026/27 the balance is due by 31 January 2028, with payments on account on 31 January and 31 July if your bill is large enough. Our sole trader tax calculator stacks Income Tax, Class 4 and payments on account in one view, and there are dedicated versions for Uber and Deliveroo earnings among the full set of calculators. One admin point: from 6 April 2026, self-employed people with qualifying income over £50,000 also fall into Making Tax Digital — check yours with the qualifying income checker.
Which classes do you pay if you're employed and self-employed?
Both. Your employer deducts Class 1 from your wages through PAYE as normal, and you pay Class 4 on your self-employed profits through Self Assessment — the two systems do not net off automatically. An annual maximum exists so that very high earners with both income types do not overpay across the classes; HMRC applies it when calculating your return, but if you have substantial earnings in both camps it is worth checking the calculation rather than assuming. Remember that National Insurance bands sit alongside, not inside, your Income Tax bands — the thresholds happen to align at £12,570 and £50,270, but they are separate charges on the same income.
Do I pay National Insurance on dividends, rent or pension income?
No. National Insurance applies to earnings from employment and profits from self-employment only. Dividends, rental profits, savings interest and pension income escape NI entirely — though dividends face their own dividend tax at 10.75%, 35.75% or 39.35% in 2026/27. See our dividend tax guide.
Has Class 2 National Insurance been abolished?
Not abolished — just made free for most. Since April 2024, self-employed people with profits at or above the Small Profits Threshold (£7,105 in 2026/27) are treated as having paid Class 2 without paying anything, keeping their State Pension record intact. Voluntary Class 2 still exists at £3.65 a week for those with profits below the threshold.
Should I pay Class 2 or Class 3 to fill a gap in my record?
Class 2 if you are entitled to it — £3.65 a week (£189.80 a year) against £18.40 a week (£956.80 a year) for Class 3. Class 2 is only available for periods of self-employment with low profits; Class 3 is the fallback for everyone else. Always check your State Pension forecast on gov.uk first, because filling some gaps adds nothing to your pension.
I earn less than £242 a week — am I losing State Pension years?
Not necessarily. If you earn between £129 and £242 a week from one job in 2026/27, you pay no National Insurance but are still treated as contributing, so the year can still qualify (gov.uk). Below £129 a week, nothing is added automatically — check whether you qualify for NI credits (for example through Child Benefit) before considering voluntary contributions.
Do I stop paying National Insurance at State Pension age?
Employees stop paying Class 1 once they reach State Pension age, although their employer keeps paying the 15% secondary contribution. The self-employed stop paying Class 4 from the start of the tax year after the one in which they reach State Pension age — so there is usually one final Class 4 bill after the birthday (gov.uk).
Sources: National Insurance, Rates and category letters, Self-employed NI rates, Voluntary contribution rates, Employment Allowance and The new State Pension (gov.uk), verified 12 June 2026. Estimates for information only — not regulated tax advice.