For the 2025/26 tax year, employees generally start paying National Insurance (NI) when they earn more than £242 per week or £1,048 per month (£12,570 a year) from a single employer. Self-employed individuals start paying Class 4 contributions on profits exceeding £12,570 a year.
Primary Threshold (PT)
This is the point at which employees start paying National Insurance. The Primary Threshold is £12,570 for the 2025/26 tax year, which is aligned with the standard Personal Allowance for Income Tax. This means you won't pay a penny in NI or Income Tax until your earnings exceed this amount.
Who pays National Insurance. You pay mandatory National Insurance if you're 16 or over and are either: an employee earning more than £242 per week from one job. self-employed and making a profit of more than £12,570 a year.
National Insurance contributions (NICs) are a direct tax. Employees and self-employed people pay NICs once their earnings reach certain thresholds. Additionally, employers pay NICs on their employees' earnings too.
The individual needs to have paid, or be treated as having paid, Class 2 NICs for the full tax year to make a qualifying year. That is, they need to have paid, or be treated as having paid, 52 weeks' worth of Class 2 NI contributions. The individual has a qualifying year.
You usually need 35 qualifying years of National Insurance contributions to get the full amount.
Checking for and filling gaps in your NI record could be very worthwhile. If you want to fill gaps dating as far back as 2006, keep in mind that you'll lose this opportunity after 5 April 2025. After that, normal rules will apply.
You do not pay National Insurance after you reach State Pension age - unless you're self-employed and pay Class 4 contributions. You stop paying Class 4 contributions at the end of the tax year in which you reach State Pension age.
If you do not pay National Insurance you may have gaps in your National Insurance record.
You must have a certain number of full-rate PRSI contributions. If you reach pension age on or after 6 April 2012, you need to have 520 full-rate PRSI contributions (10 years' contributions).
If you have never worked and therefore never paid any National Insurance through your salary, you won't typically be eligible for any State Pension.
Net investment income includes:
Apprentice - £7.55 an hour. Age 16-17 - £7.55 an hour. Age 18-20 - £10.00 an hour. Age 21+ - £12.21 an hour (National Living Wage).
You may not qualify for the Basic State Pension yourself because you haven't paid enough National Insurance contributions or received enough National Insurance credits. You may still be able to claim Basic State Pension in some situations. You could also be eligible for Pension Credit to top-up your income.
What is the most tax-efficient director's salary for 2025–26? The most tax-efficient director's salary is £5,000, £6,500, or £12,570, depending on your company's eligibility for Employment Allowance and your personal circumstances. These levels help minimise Income Tax and National Insurance liabilities.
You'll need 10 qualifying years on your National Insurance record to get any new State Pension. A qualifying year is one in which you were: working and made National Insurance contributions.
You usually need 35 qualifying years of National Insurance (NI) contributions to get the full State Pension. If you don't have enough, you can pay to fill gaps in your record to boost how much you get – even if you're already getting your State Pension.
As long as you qualify for the UK State Pension, you'll still receive it even if you move abroad when you retire – and you can still access any workplace or private pensions you have. If you're an EU national who's built up a pension in the UK, you'll still be able to access it or move it to the country of your choice.
The "pension 5-year rule" refers to different IRS rules for retirement accounts (like Roth IRAs needing 5 years for tax-free earnings), beneficiary rules (requiring heirs to empty inherited accounts within 5 years), and specific employment pensions (like Federal or Congressional plans requiring 5 years of service for vesting or benefits). It can also relate to UK pension rules for overseas transfers (QROPS) or breaks in service for public sector workers, preventing tax avoidance or loss of benefits.
You may not be able to pay National Insurance, for example if you are ill or caring for someone. The government may give you credits so you can continue building up State Pension entitlement. Find out who can get National Insurance credits and whether you need to take action.
The amount of NI that you have to pay depends on how much money you earn, and whether you're employed or self-employed. This means that you could continue working past state retirement age, or even retire from employment and set up your own business, and won't need to pay National Insurance!
The government has announced that the State Pension age (SPa) timetable will, for the time being, remain unchanged from the current legislated timetable: SPa will increase from 66 to 67 – between April 2026 and April 2028. SPa will increase from 67 to 68 – between April 2044 and April 2046.
If you have never worked, and therefore never paid NI, you may still be eligible for the State Pension if you have received certain state benefits, for example carer's allowance or Universal Credit.
Retiring at 60 with $500,000 in super is possible but challenging, depending heavily on your spending, lifestyle, and if you qualify for the Australian Age Pension. You might cover modest expenses using strategies like drawing down around $20,000 annually (using the 4% rule as a guide) plus other income, but it requires careful budgeting, potentially part-time work, and reducing living costs. A financial advisor can help tailor a plan, as $500k alone usually supports a basic to moderate retirement, not a lavish one.
The normal pension age is same as the member's state pension age or age 65, whichever is later. Members can retire earlier or later depending on the Section or Scheme they are in. The NHS Pension Scheme overview (PDF:185 KB) provides more detail about each Scheme.