Business Services Organisation
National Insurance Contributions (NIC) are deducted on earnings above the lower earnings limit. The 2025/2026 earning limits are:
| Class 1 NIC | Weekly | Monthly |
| Lower Earning Limit (LEL) | £125 | £542 |
| Secondary Threshold (ST) | £96 | £417 |
| Primary Threshold (PT) | £242 | £1,048 |
| Upper Earning Limit (UEL) | £967 | £4,189 |
Employers use an employee’s National Insurance category letter to work out how much an employee should pay.
| Letter | Category Definition |
| A | All employees (apart from those stated below) |
| B | Married women and widows entitled to pay reduced National Insurance |
| C | Employees over the State Pension age |
| H | Apprentices under 25 |
| J | Employees who can defer National Insurance because they’re paying it in another job |
| M | Employees under 21 |
| Z | Employees under 21 who can defer National Insurance because they’re paying it in another job |
NIC’s are calculated at the following percentages:
| Category | LEL to PT | PT to UEL | Above UEL |
| A | 0% | 8% | 2% |
| B | 0% | 1.85% | 2% |
| C | 0% | 0% | 0% |
| H | 0% | 8% | 2% |
| J | 0% | 2% | 2% |
| M | 0% | 8% | 2% |
| Z | 0% | 2% | 2% |
For more information on NIC click the link below:
National Insurance Overview – GOV.UK