Self –employed individuals currently pay Class 2 National Insurance Contributions (NICs) at a
weekly flat rate of £2.75.

From 6 April 2015, the mechanism for calculating and paying Class 2 NICs will change and be
made through your Self-Assessment tax return.

For the 2015/16 tax year you will only have to pay Class 2 NICs if your profits are above
£7,956.  If you currently hold a Small Earnings Exception Certificate then this won’t be renewed and HMRC should already have written to you advising of the changes.  But you can still voluntarily pay Class 2 NICs to protect your entitlement to certain benefits and State Pension.

Class 2 payment requests will be issued as normal in April 2015 for 2014/15 and if you
currently pay by direct debit the last payment by this method will be taken on 10
July 2015.

Your Class 2 NICs for 2015/16 will then be calculated through your Self-Assessment tax
return and must be paid by 31 January 2017.  The weekly rate for 2015/16 is £2.80.

So you’ll have more time to pay your Class 2 NICs for 2015/16.

The Chancellor also said in his Budget on 18 March that he intends to abolish Class 2 NICs altogether if the Conservatives are re-elected in the General Election so watch this space for further details.

If you want more information about the changes to Class 2 NICs, then call Katy today on 07810
518812.