NIM24153 - Class 4 NICs: Structure: Annual Class 4 NICs maximum from 6 April 2003: Contributors who are self- employed only: Calculation method.
Regulation 100 - Social Security Contributions Regulations 2001听
NIM24152听explains that there is no prescribed annual maximum of Class 2 and 4 NICs Liability for a person who is self-employed only.听
To calculate the amount of Class 2 and 4 NICs payable by someone who has no other employments the following method applies up to 5 April 2024.听
Step 1听
Multiply the amount of profits between the Lower Profits Limit and the Upper Profits Limit by the main Class 4 NICs percentage rate听
Step 2听
Multiply the amount of profits that exceed the Upper Profits Limit by the additional Class 4 NICs percentage rate.听
Step 3听
Multiply the relevant Class 2 NICs rate by the number of weeks of self-employment in the tax year听
Step 4听
Add together the results of steps 1, 2 and 3.听
The result of step 4 is the amount of Class 2 and Class 4 NICs payable by a contributor who is self-employed only.听
Examples of the calculation can be found at听NIM24160.
From 6 April 2024
Step 1听
Multiply the amount of profits between the Lower Profits Limit and the Upper Profits Limit by the main Class 4 NICs percentage rate听
Step 2听
Multiply the amount of profits that exceed the Upper Profits Limit by the additional Class 4 NICs percentage rate.听
Step 3
Add together the results of steps 1 and 2.听
The result of step 3 is the amount of Class 4 NICs payable by a contributor who is self-employed only.听
Examples of the calculation can be found at听NIM24160.