Self Assessment and Class 2 NI

Hello All. I'm new to SE but only stuck with one aspect. I'm doing my Self Assessment for 2022-23, and it's my second time doing it ever. I am stuck on the part about Class 2 National Insurance contributions, it's telling me that I should pay £163.80 based on my Total taxable profits for that tax year. in 2022-23 I started being a self-employed forklift driver in December 2022. My profits between December 2022 and 5 April 2023 were below the £11908 limit. However before December 2022 I was employed through PAYE on a couple of short term jobs and the earnings from those employments and the self-employment are £11910, £2 above the limit. My earnings from self-employment were below £11908, i'm not sure the limit only applies to self-employment earnings or everything (employment and self-employment)? Many thanks for any help and clarification.

Hi,

Where a person is liable to pay Class 2 National Insurance contributions (NICs), Class 2 NICs are due for each contribution week or part of a week that a person is self-employed. So, where a person is self-employed and liable to pay Class 2 NICs for part or all of one day in a week, liability arises for one week’s NICs due at the weekly flat rate.                                                                                                
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.

For 2023 to 2024 onwards, the Lower Profits Limit will be the same amount as the personal allowance for income tax (£12,570 for 2023 to 2024).

A ‘contribution week’ is defined as a period of seven days beginning with midnight between Saturday and Sunday. The first day of the contribution week is Sunday and Saturday is the last. The first week of the contribution year starts on the first Sunday after 5 April.

Thank you.

How do I pay Class 2 NIC voluntarily?

Hello, I know this thread had a reply that was five months old but I'm a bit confused with which category pays what and what it means so I hope you can help. I just want to understand how it works correctly. Reading the last reply, does it mean that for the 2022/23 tax year... Small Profits Threshold * anyone that is self-employed and has a net profit amount that is under £6,725 * ONLY if they pay the voluntary Class 2 NIC at the £3.15 per week rate that's when they are able to access entitlement to contributory benefits (so if they don't, they won't have the access) Lower Profits Threshold * anyone that is self-employed and has a net profit amount that is between £6,725 and £11,908 * they DON'T need to pay any voluntary Class 2 NIC but they would still be able to access entitlement to contributory benefits I am self-employed with it being my single source income and my net profit in the 2022/23 tax year is calculated to be under £4,600. Does it mean that only if I pay £3.15 x 52 = £163.80 of voluntary Class 2 NIC to ensure that I am able to access entitlement to contributory benefits?

Hi Silver Odwar,
Please refer to:
Pay Class 2 National Insurance if you do not pay through Self Assessment
Thank you. 


 

I have just logged into my Personal Tax account to see if the year 2022-23 is set to Full, but it says Year is not Full We are checking this year to see if it counts towards your pension. We’ll update your record when this is finished, I was confident it would be a Full Year as between December 2022 and June 2023 I had wages every week (CIS self employed) and I did my Self Assessment in July. I do not understand why it's not Full.

Hi Irene,
Question “Does it mean that only if I pay £3.15 x 52 = £163.80 of voluntary Class 2 NIC to ensure that I am able to access entitlement to contributory benefits?”
The answer is yes, if you have a net profit below £6725.00 you may wish to consider paying Class 2 NICs for benefit purposes.
Thank you.
 

Hi nebulaman,
It’s not possible to give you a suitable answer without checking your National Insurance account.
We would advise you contact us here:
National Insurance: general enquiries
Thanks
 

Hi, I’m currently abroad in Peru. I’ve lost my English sim and am using a Peruvian one. This means I’m unable to login to my self assessment page to pay before the deadline as a login code is always sent to English number. It also means I can’t contact HMRC as it’s all done through phone. Any suggestions on how to sort this would be greatly appreciated. Thanks Ben

Hi Bphil94,
If you are unable to self serve to reset your telephone number online then you would need to contact our online heldesk for further assistance.
You can contact HMRC here:
Technical support with HMRC online services
Thank you. 

Hi I'm confused by this "If your taxable profits are from £6,725 to £11,908, you will not need to pay Class 2 NICs. Your contributions are treated as having been paid to protect your entitlement to State Pension and certain benefits." I'm in this bracket yet I'm still being asked to pay £163.80 NIC Anyone understand why? Thanks

Turns out my last post was created prematurely. Once I clicked through to the end the correct amount (£0) was showing.

Hello - Ive been self employed for many years and would like to pay backdated class 2 NI contributions for the gaps since April 2006 to ensure I qualify for the state pension I eventually got through to NI but they said its HMRC - Ive written to them last Oct but no reply (not even a confirmation of letter received) If outside of the UK you fill in form CF83 and appear to get it dealt with quickly - is there not a form for self employed in the UK? Help - going round in circles

Hi anthony mccormack

I am a little confused by your reference to ‘NI’ and ‘HMRC’ as NI is dealt with by HMRC.

The area dealing with correspondence from self employed customers are currently working on letters received in June 2023 so I am afraid it will be a little while until they can deal with your letter. As an alternative, can I suggest you contact the NI helpline on 0300 200 3500. Lines are open 8am – 6pm Monday to Friday.

Thanks

 

Thank you - we actually got a reply today However we asked to pay outstanding from 2006 - and they only sent details on to pay from 2017/18 - stating 2016/17 needed to be paid by 5th April 2023. However I thought to pay backdated class 2 we had until 5 April 2025 - or does that not applied to self employed ? Thanks

My wife has been charged £148.20 per year class 2 Nic’s every year since 18/19. This is the 17/18 rate. Why has this happened. She is now 5 qualifying years short, but has only under paid by £33.80 18/19-21/22 Can’t comment on 22/23 because her statement does not show class2 or 4 Nic’s Could we please have a answer on this because she wants to stop work but can’t until these 5 years are qualifying.

Hi anthony mccormack,
You can only pay back to 17/18 for UK self employed persons.  
CF83 applications are for customers abroad and the Class 2 rate of abroad NICs is not like for like with the UK SE Class 2 rate.
There is strict criteria to pay prior to the 2017/18 tax year, we look at your full period and if you have applied for Small Earning Exception and Waiver and whether you have received a refund of Class 2 NICs during the requested period. to be able.  
You may wish to call our NI helpline 0300 2003500 and request to pay for those tax years and depending on your NI record you may be able to pay at the Class 2 SE Rate of NICs.
Our staff will provide you with all relevant information during your call.
They should also advise that before making any payment prior to the 2016-2017 tax year that it will increase your UK State Pension entitlement and you must contact DWP prior to making the payment to us.
Thank you.

 

Hi Buster Blood vessel Tia,
The customer will need to contact the SA helpline to correct the problem, their telephone number is 0300 200 3310.
Thank you.

Hello HMRC I was employed for 38 years but my record shows that I have 4 years short as my employer contacted out. I contacted yourselves and have received my 16 digit reference to make payments for my gaps. Since leaving employment I have been self employed for 5 years and have not made any voluntary class 2 voluntary payments via my self assessment. I have subsequently been told by the future pension forecast helpline that I could make Class 2 voluntary payments instead of class 3 NI back payments to fill these gaps. If this is correct, please can you let me know how I can back date these class 2 contributions and for how many years. Will the 16 digit reference still be relevant for class 2 NI or was it particular to my class 3 NI enquiry. Thanks

Hi JRT26,
You will need to contact the NI helpline, their telephone number is 0300 200 3500.
National Insurance: general enquiries
As you will need a different 18 digit reference number.
We would advise also you to the Future Pension Centre (FPC) on 0800 731 0175 before you call the NI Helpline as you will need to know which years you would like to pay.
Contact the Future Pension Centre
Thank you.