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National Insurance

Class 2 National Insurance

Class 2 National Insurance is paid by every self-employed individual in the UK and this counts towards state benefits e.g. State Pension and bereavement benefits. Class 2 National Insurance is payable every 6 months 31 July and 31 January in line with the self – assessment tax year at the following rates:

Tax Year 2013/14 2014/15
Class 2 National Insurance £2.70 per week £2.75 per week

 

Foster Carers with low profits can claim Small Earnings Exception (SEE) if their profits from self-employment are below the thresholds in the table below. This means that you don’t have to pay your Class 2 National Insurance contributions, providing you make a claim to HMRC on form CF10 by 31 January following the end of the tax year. 

Tax Year 2013/14 2014/15
Class 2 SEE Limit £5,725 £5,885

 

If you do not pay any Class 2 National Insurance, your entitlement to certain state benefits may be affected, however as a foster carer you can apply for National Insurance credits.

National Insurance credits are a way for foster carers to build up qualifying years for the basic state pension providing any of the following apply:

  • You are a parent of a child aged under 12, care for them and do not receive child benefit for them
  • You are an approved foster carer 

Applications must be made within one year of the end of the tax year on form cf411a and you must have a letter accompanying the application from your fostering service, confirming that you are an approved foster carer.

 

Class 4 National Insurance

Class 4 National Insurance is payable on self-employment profits over the Class 4 Lower Profits Limit. You work out your contributions on your Self-Assessment tax return and pay them with your Income Tax liability on 31 January following the end of the tax year.

Class 4 National Insurance contributions don't count towards benefit entitlements.

 

If you have any questions…

As a FosterTalk member you and your family members have the advantage of access to your own confidential tax, accountancy and benefits helpline where our advisers will be happy to help you:

Ring           01527 836910

E-mail        enquiries@fostertalk.org

The advisers are available Mon-Fri 9am-5pm excluding bank holidays.

We guarantee to respond to e-mail enquiries within 1 working day


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10 The Courtyard, Buntsford Gate, Bromsgrove, Worcestershire, B60 3DJ
Registered Company Number: 06318354