Sarah Bradford outlines when earnings need to be aggregated for National Insurance contributions purposes.
Unlike income tax, National Insurance contributions (NICs) are not calculated on a cumulative basis. Instead, the liability is worked out separately for each earnings period.
With the exception of company directors who have an annual earnings period regardless of their actual pay frequency, the earnings period will normally correspond to the pay interval, so that weekly-paid employees have an earnings period of a week, monthly-paid employees have an earnings period of a month, and so on. The NICs liability is calculated by reference to the thresholds applicable to the earnings period.
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Class 1 NICs are only payable on earnings in excess of the relevant thresholds – the primary threshold for employee contributions and the relevant
