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  • National Insurance + Child Benefit + Self Assessment = WARGH!
  • verses
    Full Member

    Hi,

    I asked the other week about my wife setting up as a sole trader who will be earning massively below the Minimum tax threshold. We’re under way with that but we’re now confusing ourselves about Class 2 NI payments.

    Basically…
    – My wife gave up work 7 years ago to be a full time mum.
    – As we claim Child Benefit her NI was paid for her (we assume).
    – I believe NI is paid as long as you’re claiming Child Benefit up to the child’s 12th birthday.

    Now she’s a sole trader who earns below the min tax threshold, will her NI payments still be paid for her or will she need to start paying them herself?

    Ta for any help with this 🙂

    goldfish24
    Full Member

    Don’t know about child benefit but if that’s out the window then she will have to pay her own NI stamps as a sole trader. You can choose to pay them or not.

    br
    Free Member

    If she’s claiming CHB and the child is under 12, NI will be covered.

    She’ll only need 30 years for the (current) full pension entitlement – here:

    https://www.gov.uk/voluntary-national-insurance-contributions/who-can-pay-voluntary-contributions

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    moniex
    Free Member

    I did something similar about 10 years ago. 1 child, sole trader but not earning much. I did not need to pay tax, and also earned too little to have to pay NI.

    However, as we were planning to have another baby, my friend advised me to pay my NI (not sure what class ect) anyway (even though I did not need to). I think I paid in a total of about £120 ish, which then entitled me to maternity pay (over £1000 in total I think).

    I checked all this at the local tax office (as it seemed a very good deal for me!) and all was good.

    So if you are planning another baby, it may well be worth looking into paying NI even if you dont need to!

    Simone

    verses
    Full Member

    Thanks for those comments, I guess the best thing to do is ring the local tax office and find out what’s what 🙂

    br
    Free Member

    You’d be better reading what’s on the Gov website first.

    verses
    Full Member

    You’d be better reading what’s on the Gov website first.

    I keep going round in circles with the Gov site(s).

    Who can pay voluntary contributions
    Self employed with profits under £5,725 and a ‘Small Earnings Certificate’ – Yes – Class 2: £2.70 a week or Class 3: £13.55 a week

    She’s eligible to pay them, but does her Child Benefit mean she doesn’t need to? I don’t want there to be a shortfall, but equally I don’t want her to make voluntary payments if she doesn’t have to…

Viewing 7 posts - 1 through 7 (of 7 total)

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