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:
|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.
|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:
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 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.
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
The advisers are available Mon-Fri 9am-5pm excluding bank holidays.
We guarantee to respond to e-mail enquiries within 1 working day
FosterTalk Limited, Registered Company in England and Wales
10 The Courtyard, Buntsford Gate, Bromsgrove, Worcestershire, B60 3DJ
Registered Company Number: 06318354