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Class 4 NI contributions.

Spooky
Posts: 15 Forumite
in Cutting tax
As I'm self employed I pay Class 2 NI contributions monthly. After completing my tax return online, it then says I need to pay class 4 contributions as well. This is 9% of my profit/living wage, so I have to pay the basic rate of tax at 20% then a further 9% on top. 29% tax. Is this right?
0
Comments
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I'm afraid it is right.
For 2011/12 you pay class 4 NIC on the profit over £7,225.
But don't forget an employee would have paid 12% of his earnings over that amount (as well as the 20% income tax).If it’s not important to you, don’t consume it0
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