How National Insurance is worked out
National Insurance is charged on pay above a threshold, one pay period at a time. Work it out with the rates given.
This path is practice in how the records and the sums work. It is not tax advice. Any rate or allowance in a question is an example for that question, so check GOV.UK for the current figures.
Task 1Employee's National Insurance3 questions
Employees pay National Insurance on pay above a threshold. A threshold is the level at which a charge starts.
Each pay period is worked out on its own. Earlier months do not matter, which is the opposite of income tax.
In this task nothing is due on the first £1,050 of the month, and 8% is due on the rest. The real figures change every tax year.
Task 2A lower rate on higher pay4 questions
Task 3Tax and National Insurance side by side3 questions