self employed - tax query (NI)
- Thread starter Fletch
- Start date
I think (but I’m a self employed novice) you still pay the NI but I’m sure someone ITK will confirm
STUMPY
Midfield
There is a low earnings amount whereby if your profit is below that amount you can claim an exemption or if you've already paid your class 2 you can ask for a refund.
When I was self employed the low earnings amount was pretty low, off the top of my head it was around half your personal allowance for tax.
If you do request a refund or exemption you won't however get a credit for your state pension for that year.
If you also have a job as an employee and pay NI that way I guess you would be OK on that score but I'm not 100%.
@Wild Card would know better.
Sporty
Midfield
This! Class 2 is £6,725 and it's Class 4 that is £12,570
Makcem Crihs
Midfield
Same thing happened to my Mrs.
Last year paid NI but this year on same earnings didn't have to pay anything (she is self employed)
Last edited:
Fletch
Striker
profit £12400 and says nil class4 , which i get , but also says nil class 2 ? where in past sure that was paid
it looks as if profit under £6725 you can voluntarily pay it (for state pension), but if profit between 6725-12570 then you dont , the govt pay it
bizarre
Sporty
Midfield
On a side note, have you also checked the NI record for them?
Check your National Insurance record
Find out if you've paid enough National Insurance to qualify for the full State Pension - check gaps, contributions and credits, get a National Insurance statement, call the helpline.
STUMPY
Midfield
Looks like the rules have changed a little since I was last self employed 8 years ago.This! Class 2 is £6,725 and it's Class 4 that is £12,570
I don't understand what it means when it says class 2 is treated as having being paid if your profit is in-between those 2 amounts.
I'm assuming it means you don't have to pay it but hmrc treat you as though it has been paid. Seems a bit weird especially when most people I know pay class 2 by direct debit in advance
Sporty
Midfield
Aye that's it actually
Class 2 NIC are a fixed weekly amount – £3.45 per week for 2023/24 (£3.15 per week for the 2022/23 tax year) if you have made sufficient profits (see below).
The rules for Class 2 NIC changed for the 2022 to 2023 tax year onwards.
Prior to the 2022 to 2023 tax year you needed to pay Class 2 NIC if your profits were above the Small Profits Threshold.
For 2022 to 2023 onwards, you pay Class 2 NIC if your profits are above the Lower Profits Limit (which is £12,570 in 2023/24 and was £11,908 in 2022/23). If your profits are below the Small Profits Threshold (£6,725 in 2022 to 2023 and 2023 to 2024) then you can choose to pay voluntary Class 2 NIC. If your profits from self-employment are between the Small Profits Threshold and the Lower Profits Limit then there is no Class 2 NIC to pay, instead you will be treated as making Class 2 NIC. This will mean you will be able to access entitlement to contributory benefits in the same way as if you had paid Class 2 NIC.
STUMPY
Midfield
Was she paying her class 2 in advance though either in a one off or by direct debit ? I used to pay mine by direct debit.
girojim
Striker
Thats exactly it, nothing to pay between thise amounts but you still get credit as if you have for you pension (stamp)
Fletch
Striker
Nah, always done via self assessment, just pay any tax and also the NI to ensure state pension
just wanted to check incase was missing anything as in past have always ensured the NI was voluntarily paid , but dont get that option this time , for this profit.
will just submit it tonight after work , cheers replies
If you donate to the Tory party it is all good.
STUMPY
Midfield
I don't get the logic there. If profits are between £6725 and £12570 you don't pay it but get a credit. If profits are less ie below £6725 you have to pay it if you want a credit
Doesn't make sense to me 
Fletch
Striker
exactly , hence why thought was missing somethingI don't get the logic there. If profits are between £6725 and £12570 you don't pay it but get a credit. If profits are less ie below £6725 you have to pay it if you want a credit
Wild Card
Winger
From 6th April 2022 (relevant to 2022/23 tax year) Class 2 voluntary NIC does not have to be paid if taxable profits exceed the Class 2 NIC Small Profits Threshold of £6,725, but do not exceed the Class 4 NIC Lower profits Limit of £11,908.
If your total taxable profit sits in between these 2 thresholds, HMRC will treat your Class 2 NIC as being paid. No physical payment is needed by individuals, and National Insurance credits will continue to be accumulated.
If your taxable profits sit below £6,725 then Voluntary Class 2 NIC will still need to be paid to HMRC to ensure National Insurance contributions are credited.
You should be making class 2, its a really cheap way to get a pension stamp...unless you don't need to.
