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Have I got this right
I am or will be employed by my company and I will draw around 8K as a salary
If I use the threshold of around 8K I pay no NI Class 1 or 2
I have been reading the rules on NI
It looks to me when you reach retirement age ie 66 I am not liable for NI Class 1 or 2
This is quite important to me as this will allow me to have a larger Salary above the NI limit of around 8K
I think the saveing to me and my company would be around 18% paying only 40% higher rate
This is the section from the Gov NI
At State Pension age:
If you’re self employed, you still need to send a Self Assessment tax return for the year you reach State Pension age.
You can claim back National Insurance if you’ve overpaid.
Show your employer proof of your age (a birth certificate or passport, for example) to make sure you stop paying National Insurance.
Can anyone confirm this is the case
It would fit my own circumstances very well indeed
Learn Change and Adapt ?????
It depends on the amount if any, of state pension you wish to receive. The level of state pension is determined by your NI contributions so if you have used the company personal pension allowances to meet your pension needs then this might be the route to go for you.
hi thank I understand your points but as I read the gov info I think I don't pay NI after retirement age even if I have pension income
- minor tweak..
The level of state pension will depend on the rules in force when you reach state pension age.. FK what they will be, after this lot finally get round to limiting the benefits of about 50% of the benefits spend. benefits for the old.. You will have noticed state pension age creeping up, expect more and other restrictions. IIRC correctly the rules on how many years NI you needed have changed also
For the avoidance of doubt I am old, am in receipt of 6 benefits: State Pension, 'bus pass, Winter Fuel allowance, free prescriptions, £10 Xmas bonus (must cost at least half of that to run..), free eye tests: Thank you you generous taxpayers you... NO means tests for any of those 6, pension keeps going up, bonkers...
You stop paying employee contributions at state pension age, but your company would still have to make employer contributions. So there is still a reason to stay below the limit.
Change their National Insurance category letter to ‘C’ in your payroll software - this means you’ll stop deducting National Insurance from their pay. You still need to pay employer’s contributions for them.
Hi Peter I knew there would be a catch but better to have half a loaf rather than non
Thanks for that
Companies do get an allowance for employer NICs. If they would pay less than £3,000 they don't need to pay at all. However not all companies get this. Last year single director companies where the director is the only employee earning above the £8k NICs threshold were excluded. If you have a second employee paid just above the threshold I think you can push your salary quite a bit higher before the company has to pay NICs.
Thank you for that its never straightforward is it
we live and learn lol