This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our Cookie Policy.

Tools which collect anonymous data to enable us to see how visitors use our site and how it performs. We use this to improve our products, services and user experience.


Tools that enable essential services and functionality, including identity verification, service continuity and site security.

Where Taxpayers and Advisers Meet

How does it works?
Posts: 39
Joined: Wed Aug 06, 2008 3:05 pm

Postby » Sat Jan 10, 2004 10:43 am

Roughly speaking, for most empoyees on a salary how is national insurance deducted?

Do they take your gross salary, take 11% National Insurance off for any earnings over £89 per week and then take income tax off what is left before you get paid. Or do they calculate income tax and national insurance seperately on your gross amount?

Who pays employers national insurance? - Do they take this from you also or is this paid by your employer over and above you salary?


Ian McTernan CTA
Posts: 1232
Joined: Wed Aug 06, 2008 3:02 pm
Location: Bedford

Postby Ian McTernan CTA » Sun Jan 11, 2004 1:37 pm

Income tax and national insurance are calculated separately, although in both cases for employees the first £89 per week is exempt. There is also a higher threshold for employees NIC above which you only pay 1%.

Employers NIC is paid by your employer, and applies to all earnings no matter how high. You can liken it to a tax on having employees- you pay the Government for the privilege of paying someone to do work for you!

Ian McTernan CTA
McTernan Associates Ltd
Chartered Tax Advisers
McTernan Associates Ltd
Chartered Tax Advisers
Email through link on website:

Return to “PAYE and Payroll Taxes, National Insurance, NICs”