Quick Answer: Employee NI Rates 2026/27
| Earnings Band | Rate | Annual Threshold |
|---|---|---|
| Below Primary Threshold | 0% | Up to £12,570 |
| Primary Threshold to UEL | 8% | £12,570–£50,270 |
| Above Upper Earnings Limit | 2% | Over £50,270 |
You pay nothing on the first £12,570. After that, your employer deducts 8% through PAYE until your earnings reach £50,270, then 2% on everything above.
How Employee National Insurance Works
Employee National Insurance is a Class 1 contribution deducted automatically from your pay by your employer through PAYE (Pay As You Earn). You do not need to calculate or pay it yourself — it comes off your gross pay before you receive your wages.
What Employee NI Pays For
Your NI contributions build your entitlement to:
- State Pension — you need 35 qualifying years for the full amount (£221.20/week in 2026/27)
- Contribution-based Jobseeker's Allowance
- Employment and Support Allowance (contributory)
- Maternity Allowance
- Bereavement benefits
Unlike income tax, which goes into general government revenue, NI contributions are directly linked to your benefit entitlements. You need at least 10 qualifying years to receive any State Pension at all.
When You Start Paying
You begin paying employee NI when you:
- Are 16 or over
- Earn above the Primary Threshold (£12,570/year, £1,048/month, £242/week)
- Are under State Pension age (currently 66, rising to 67 by 2028)
Once you reach State Pension age, you stop paying employee NI — even if you continue working.
2026/27 NI Thresholds
| Threshold | Annual | Monthly | Weekly |
|---|---|---|---|
| Lower Earnings Limit (LEL) | £6,396 | £533 | £123 |
| Primary Threshold (PT) | £12,570 | £1,048 | £242 |
| Upper Earnings Limit (UEL) | £50,270 | £4,189 | £967 |
What Each Threshold Means
- Lower Earnings Limit (LEL): You do not pay NI below this, but earnings between the LEL and PT still count as a qualifying year for State Pension — so you build entitlement without paying anything.
- Primary Threshold (PT): The point at which you actually start paying 8% NI.
- Upper Earnings Limit (UEL): Above this, the rate drops from 8% to 2%.
Comparison with Previous Tax Years
| Tax Year | Rate (PT to UEL) | Rate (above UEL) | Primary Threshold |
|---|---|---|---|
| 2023/24 | 12% (then 10% from Jan) | 2% | £12,570 |
| 2024/25 | 8% | 2% | £12,570 |
| 2025/26 | 8% | 2% | £12,570 |
| 2026/27 | 8% | 2% | £12,570 |
The employee NI rate was cut from 12% to 10% in January 2024, then to 8% from April 2024. The Primary Threshold has been frozen at £12,570 since 2022/23.
Worked Examples: How Much NI Do You Pay?
Salary: £25,000
| Component | Calculation | Amount |
|---|---|---|
| Earnings below PT | First £12,570 | £0 NI |
| Earnings in 8% band | £25,000 − £12,570 = £12,430 | £12,430 × 8% = £994.40 |
| Total annual NI | £994.40 | |
| Monthly NI | £994.40 ÷ 12 | £82.87 |
Salary: £35,000
| Component | Calculation | Amount |
|---|---|---|
| Earnings below PT | First £12,570 | £0 NI |
| Earnings in 8% band | £35,000 − £12,570 = £22,430 | £22,430 × 8% = £1,794.40 |
| Total annual NI | £1,794.40 | |
| Monthly NI | £1,794.40 ÷ 12 | £149.53 |
Salary: £50,000
| Component | Calculation | Amount |
|---|---|---|
| Earnings below PT | First £12,570 | £0 NI |
| Earnings in 8% band | £50,000 − £12,570 = £37,430 | £37,430 × 8% = £2,994.40 |
| Total annual NI | £2,994.40 | |
| Monthly NI | £2,994.40 ÷ 12 | £249.53 |
Salary: £75,000
| Component | Calculation | Amount |
|---|---|---|
| Earnings below PT | First £12,570 | £0 NI |
| Earnings in 8% band | £50,270 − £12,570 = £37,700 | £37,700 × 8% = £3,016.00 |
| Earnings in 2% band | £75,000 − £50,270 = £24,730 | £24,730 × 2% = £494.60 |
| Total annual NI | £3,510.60 | |
| Monthly NI | £3,510.60 ÷ 12 | £292.55 |
Summary Table
| Annual Salary | Annual Employee NI | Monthly NI | Effective NI Rate |
|---|---|---|---|
| £20,000 | £594.40 | £49.53 | 2.97% |
| £25,000 | £994.40 | £82.87 | 3.98% |
| £30,000 | £1,394.40 | £116.20 | 4.65% |
| £35,000 | £1,794.40 | £149.53 | 5.13% |
| £40,000 | £2,194.40 | £182.87 | 5.49% |
| £50,000 | £2,994.40 | £249.53 | 5.99% |
| £60,000 | £3,210.60 | £267.55 | 5.35% |
| £75,000 | £3,510.60 | £292.55 | 4.68% |
| £100,000 | £4,010.60 | £334.22 | 4.01% |
Use our free employer NI calculator to check your exact figures.
NI Classes Explained
Employee NI is only one class. Here is how all four classes work:
| Class | Who Pays | Rate (2026/27) | What It Covers |
|---|---|---|---|
| Class 1 | Employees (and employers) | 8% / 2% employee; 15% employer | State Pension, JSA, ESA, Maternity Allowance |
| Class 2 | Self-employed | £3.45/week (if profits above £12,570) | State Pension, Maternity Allowance |
| Class 3 | Voluntary | £17.45/week | Fills gaps in NI record for State Pension |
| Class 4 | Self-employed | 6% on £12,570–£50,270; 2% above | No benefit entitlement — purely a tax |
If you are employed, you only pay Class 1. Your employer deducts it automatically — you do not need to register or file anything separately.
If you are self-employed, you pay Class 2 and Class 4 instead of Class 1, calculated through your Self Assessment tax return.
How to Check Your NI Contributions
1. Your Payslip
Every payslip should show your NI deduction for that pay period. Look for a line labelled "NI" or "National Insurance." Compare it against the rates above to confirm it is correct.
2. HMRC Personal Tax Account
Visit gov.uk/personal-tax-account to:
- View your NI contributions record
- Check how many qualifying years you have
- See gaps that could affect your State Pension
- Find your National Insurance number
3. Check Your NI Number
Your NI number is on your payslip, P60, or any letter from HMRC. It follows the format: two letters, six numbers, one letter (e.g., AB 12 34 56 C). You can also find it through your HMRC Personal Tax Account.
Employee NI vs Employer NI: Key Differences
| Employee NI | Employer NI | |
|---|---|---|
| Rate | 8% (then 2% above UEL) | 15% |
| Threshold | £12,570 (Primary Threshold) | £5,000 (Secondary Threshold) |
| Who pays? | Deducted from your pay | Paid by employer on top of salary |
| Appears on payslip? | Yes | No (not deducted from your wages) |
| Builds State Pension? | Yes | No |
| Stops at State Pension age? | Yes | No — employer pays regardless |
| Annual cost on £35,000 salary | £1,794.40 | £4,500.00 |
Key point: Employer NI is an additional cost the employer pays — it does not reduce your take-home pay. Your payslip shows only your employee NI deduction.
For a detailed breakdown of employer NI, including Employment Allowance and cost-reduction strategies, see our Employer National Insurance Rates 2026/27 guide.
Ways to Reduce Your Employee NI
While you cannot change the NI rate, there are legitimate ways to reduce how much you pay:
Salary Sacrifice
If your employer offers salary sacrifice for pension contributions, you give up part of your gross salary in exchange for higher employer pension contributions. Because your gross salary is lower, you pay less NI.
Example: Sacrificing £5,000 into pension saves £5,000 × 8% = £400/year in employee NI, plus you avoid income tax on that amount too.
Tax-Free Allowances
Certain payments from your employer are not subject to NI:
- Employer pension contributions (no NI on employer-paid amounts)
- Childcare vouchers (legacy schemes, up to £55/week)
- Cycle to Work scheme (via salary sacrifice)
Tracking Your NI with Grove
Grove shows your NI breakdown clearly on every payslip:
- Gross pay, NI deduction, and net pay itemised per pay period
- Year-to-date NI contributions so you can track your total
- Salary sacrifice impact shown before and after
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Rachel Richardson
Head of Growth & Marketing, Grove HR
Rachel leads growth and marketing at Grove HR, with over a decade of experience in UK HR technology. She writes practical guides to help small businesses navigate employment law and build better workplaces.
Frequently Asked Questions
What is the employee NI rate for 2026/27?
The employee National Insurance rate for 2026/27 is 8% on earnings between the Primary Threshold (£12,570) and the Upper Earnings Limit (£50,270). You pay 2% on any earnings above £50,270. For example, someone earning £35,000 pays £1,794.40 per year in employee NI.
What is the Primary Threshold for National Insurance?
The Primary Threshold for 2026/27 is £12,570 per year (£1,048 per month, £242 per week). You do not pay any employee NI on earnings below this amount. The threshold has been frozen at £12,570 since 2022/23.
Do I pay National Insurance on my pension contributions?
If you make pension contributions through salary sacrifice, you do not pay NI on the sacrificed amount — reducing your NI bill. However, if you make pension contributions from your net pay (relief at source), NI has already been deducted from your gross pay before the contribution.
Is there an NI-free amount I can earn?
Yes. You pay no employee NI on the first £12,570 of annual earnings (the Primary Threshold). Earnings between the Lower Earnings Limit (£6,396) and the Primary Threshold count toward your State Pension qualifying years even though you pay £0 in NI.
How is National Insurance different from income tax?
Income tax is a general tax on all income that funds government spending. National Insurance is specifically linked to benefit entitlements — it builds your qualifying years for State Pension, Jobseeker's Allowance, and Maternity Allowance. NI also stops when you reach State Pension age, whereas income tax continues. The rates and thresholds are different: income tax starts at 20% above £12,570, while employee NI is 8% above £12,570.
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