Class 4 National Insurance: rates, examples and who pays
Class 4 is the part of self-employed National Insurance that actually costs money. Class 2 is now treated as paid for most people, so for a typical sole trader Class 4 is the only National Insurance on the bill.
Class 4 rates by year
| Tax year | Lower profits limit | Main rate (up to £50,270) | Rate above £50,270 |
|---|---|---|---|
| 2022-23 | £11,908 | 9.73% | 2.73% |
| 2023-24 | £12,570 | 9% | 2% |
| 2024-25 | £12,570 | 6% | 2% |
| 2025-26 | £12,570 | 6% | 2% |
| 2026-27 | £12,570 | 6% | 2% |
The 2022-23 rates are odd because the Health and Social Care Levy came in and was then reversed partway through the year, so HMRC used a blended rate for the whole year. The cut from 9% to 6% in 2024-25 was one of the biggest tax cuts the self-employed have had in years.
How much Class 4 you pay: worked examples for 2025-26
| Profit | Class 4 National Insurance |
|---|---|
| £12,570 or less | £0 |
| £15,000 | £145.80 |
| £25,000 | £745.80 |
| £35,000 | £1,345.80 |
| £50,270 | £2,262.00 |
| £80,000 | £2,856.60 |
| £150,000 | £4,256.60 |
To work it out yourself, take your profit minus £12,570, up to a maximum of £37,700, and multiply by 6%. Then take anything above £50,270 and multiply by 2%. On £80,000: £37,700 at 6% is £2,262, plus £29,730 at 2% is £594.60, giving £2,856.60. The estimator does this for any year from 2022-23 and shows it next to your Income Tax, and the 2025-26 SA302 calculator guide has a full worked example.
Who pays Class 4
Sole traders and partners in a partnership pay Class 4 on their share of the profit above £12,570. Company directors do not pay it on their company's profits. They pay Class 1 on any salary, and dividends carry no National Insurance at all, which is part of the sole trader vs limited company comparison.
Class 4 is worked out on profit, not turnover. What you can deduct as allowable expenses reduces your Class 4 as well as your Income Tax.
If you reach State Pension age, you keep paying Class 4 for the rest of that tax year, then stop from the next 6 April.
What Class 4 does not get you
Class 4 earns no State Pension or benefit entitlement. It works like an extra layer of tax on self-employed profit. Add it to Income Tax and the rate on each extra pound of profit is 26% in the basic-rate band (20% plus 6%) and 42% in the higher-rate band (40% plus 2%). Our guide to how much tax you pay when self-employed shows the totals at different profits.
Where it appears on your SA302 and bill
On an SA302, Class 4 comes after the Income Tax bands, shown at 6% and 2% on the relevant slices of profit. It is added to Income Tax to give the total due. Class 4 is also included when HMRC works out your payments on account, so it is part of your January and July instalments. Class 2 is not.
Frequently asked questions
What is Class 4 National Insurance?
It is the National Insurance self-employed people pay on their profit, collected through Self Assessment with Income Tax. It does not count towards your State Pension.
What is the Class 4 National Insurance rate for 2025-26 and 2026-27?
6% on profit between £12,570 and £50,270, and 2% on profit above £50,270. The rates and thresholds are the same in both years and in 2024-25.
How much Class 4 will I pay on £30,000 profit?
For 2025-26, £1,045.80. That is £30,000 minus £12,570, which is £17,430, at 6%.
Do I pay Class 4 National Insurance after State Pension age?
You pay it for the tax year in which you reach State Pension age, then you stop from the following 6 April.
Is Class 4 included in payments on account?
Yes. Payments on account are based on your Income Tax and Class 4 National Insurance. Class 2 is not included.