Income Tax - NIC (National Insurance Contribution) & ISA Flashcards Preview

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Flashcards in Income Tax - NIC (National Insurance Contribution) & ISA Deck (4)
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1
Q

What is National Insurance Contribution

A

You pay NIC to qualify for certain benefits including the state pension. It applies if you are between 16y and 65y earning more than $8060 annually and for self-employed $5965 annually.

2
Q

What are the types of NIC’s?

A

Here are the types of NIC’s

  1. Class 1 P (Employees)
  2. Class 1 S, Class 1A (Employers)
  3. Class 2 and Class 4 (Self-employed)
3
Q
  1. Class 1 Primary paid by?
    What are the rates?
  2. Class 1 Secondary paid by?
    What are the rates?
  3. Class 1A paid by?
A

Paid by employees

Rates are
Between 8060-43000 12%
43,000 and above 2%

Paid by employers

Rates are
8,112 and above 13.8%

Paid by employers
For non-cash benefits at the rate of 13.8%

4
Q
  1. Class 2 paid by?
    What are the rates?
  2. Class 4 paid by?
    What are the rates?
A
  1. Paid by self-employed
  2. 80 a week above 5,965
  3. Paid by self employed
    8,060-43,000 at the rate of 9%
    43,000 and above at the rate of 2%