What income threshold in the UK do National Insurance contributions apply to?
NIC isn’t calculated on a cumulative basis like tax. Each payday is taken in isolation, NIC deducted accordingly if due. There is no provision for any refunds unless employer has made a mistake in the year. A person earning under £110 a week should not have NIC deducted. On £110 you pay 1p, it then works out at 11% of any excess. A person on a low income which is under the limit should ask the Benefits Agency if there is any way they can get NI credits. Otherwise they won’t be able to claim state retirement pension or certain other benefits. See http://www.hmrc.gov.uk/rates .
