National Insurance funds the NHS, state pension and benefits. Here's exactly how much you pay as an employee in 2026/27 and how it's calculated.
National Insurance (Class 1 employee contributions): Class 1 National Insurance is paid by employees on earnings above the Primary Threshold (£12,570 in 2026/27). The main rate is 8% on earnings between £12,570 and £50,270. Above the Upper Earnings Limit of £50,270, the rate drops to 2%. Employers also pay Class 1 NI at 13.8% on earnings above £9,100 — this is separate from and in addition to employee contributions.
| Earnings band | Employee NI rate |
|---|---|
| £0–£12,570 (below Primary Threshold) | 0% |
| £12,571–£50,270 (main band) | 8% |
| Above £50,270 (above Upper Earnings Limit) | 2% |
The 8% rate was reduced from 10% in January 2024 and from 10% to 8% again in April 2024. These cuts have meaningfully increased take-home pay for employees across all income levels.
NI is calculated on your earnings each pay period, not annually. However the annual equivalent is:
The most effective way to reduce employee NI is salary sacrifice:
Note: personal pension contributions (not salary sacrifice) do not reduce NI — they only attract income tax relief. Only salary sacrifice arrangements save both tax and NI.
Employee Class 1 NI is 8% on earnings between £12,570 and £50,270, and 2% on earnings above £50,270. There is no NI on earnings below £12,570.
Only if you make personal contributions — these come from net pay after tax and NI. If you contribute via salary sacrifice, your gross salary is reduced and you pay NI on the lower amount, saving NI on the sacrificed portion.
Yes. You need 35 qualifying years of NI contributions to receive the full new state pension (£221.20/week in 2026/27). Years when you earn below the Lower Earnings Limit (£6,396) do not count as qualifying years.
Employers pay Class 1 NI at 13.8% on employee earnings above £9,100 per year. This is in addition to — and separate from — employee NI contributions. The employer rate was increased from 13.8% base in the Autumn 2024 Budget.
The free salary calculator shows your exact NI contributions alongside income tax and take-home for any salary.
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