National Insurance for the Self-Employed

When you're self-employed in the UK, you pay National Insurance contributions differently from employees. Instead of automatic deductions from your pay, you'll pay Class 2 and Class 4 contributions based on your annual profits, usually through your Self Assessment tax return.

Who pays National Insurance as self-employed

If you're a sole trader or in a partnership, you'll need to pay National Insurance on your self-employed income. Your profits are worked out by deducting your business expenses from your self-employed income.

The amount you pay depends on how much profit your business makes each year.

Class 2 National Insurance

Class 2 National Insurance helps protect your entitlement to certain state benefits, including the State Pension.

If your profits are £6,845 or more

If your annual profits reach £6,845 or more, Class 2 contributions are automatically treated as paid. This protects your National Insurance record without you having to make an actual payment.

If your profits are less than £6,845

When your profits fall below £6,845 a year, you don't have to pay Class 2 contributions. However, you may want to consider paying voluntary Class 2 contributions to maintain your National Insurance record and protect your entitlement to benefits like the State Pension.

For the 2025/26 tax year, the voluntary Class 2 rate is £3.50 a week.

Class 4 National Insurance

Class 4 is the main National Insurance payment for self-employed people with higher profits.

You must pay Class 4 contributions if your profits are more than £12,570 a year.

Class 4 rates for 2025/26

For the 2025 to 2026 tax year, Class 4 National Insurance rates are:

6% on profits between £12,570 and £50,270
2% on profits above £50,270

Example

If your self-employed profits are £35,000:

You pay nothing on the first £12,570
You pay 6% on the remaining £22,430 (£35,000 minus £12,570)
Your Class 4 bill would be £1,345.80

How to pay

Most self-employed people pay both Class 2 and Class 4 National Insurance through Self Assessment. You'll calculate and pay these contributions when you submit your Self Assessment tax return and pay your Income Tax.

You must register with HMRC when you become self-employed, either as a sole trader or as part of a partnership. This ensures you're set up to pay National Insurance correctly from the start.

Special cases and exceptions

Some self-employed people don't pay National Insurance through Self Assessment but may choose to pay voluntary contributions instead.

This includes:

Examiners, moderators, invigilators and people who set exam questions
Ministers of religion who don't receive a salary or stipend
People who make investments for themselves or others, but not as a business and without receiving a fee or commission

Landlords

If you rent out a property, the rules are different. You should check whether you need to pay National Insurance on your rental income, as this depends on your specific circumstances.

Protecting your National Insurance record

Your National Insurance record determines your entitlement to certain state benefits, most importantly your State Pension. Each year you pay (or are treated as having paid) National Insurance counts as a 'qualifying year' towards these benefits.

Even if your profits are below the Class 2 threshold of £6,845, it's worth considering voluntary contributions to avoid gaps in your record. These gaps could reduce your State Pension or affect other benefit entitlements.

What counts as profit

Your taxable profit is your self-employed income minus allowable business expenses. This is the same figure you use to calculate your Income Tax.

Allowable expenses include costs that are necessary for running your business, such as office costs, travel, stock and materials, and professional fees. Getting your expenses right is important because it affects both your Income Tax and National Insurance bill.

Next steps

When you start working for yourself, register as self-employed with HMRC as soon as possible. This ensures you're set up correctly to pay National Insurance from the beginning.

You'll then pay your National Insurance contributions as part of your annual Self Assessment tax return, alongside your Income Tax. The deadline for online Self Assessment returns is 31 January following the end of the tax year.

Sources

This article provides general guidance based on current HMRC rules. For advice specific to your situation, speak to your accountant.