So it is farewell to Class 1 National Insurance Contributions for entertainers, actors, stage managers etc. Well almost…
Class 1 National Insurance isn’t quite gone yet…
The 2013/14 Tax Return must still take into the Class 1 National Insurance deducted during that year.
If you have not already done so, it is important that you register for Class 2 National Insurance Contributions (£143.00 is the amount due for the year to 5th April 2015) as soon as possible. You can phone HM Revenue & Customs on 0300 200 3505 to arrange this. All Mark Carr & Co clients, at the time, were automatically switched over to Class 2. If you expect your profits to be below £5885 you may well be entitled to exception from paying Class 2 National Insurance. This should not be done lightly as you may lose valuable benefits. If you do wish to go ahead you should request a CF10 exception form from HM Revenue & Customs.
So what does Class 4 National Insurance Contributions offer?
Well, not a lot… Nothing in fact! Class 4 National Insurance doesn’t give you any entitlement to any benefits. It really is a just another National Insurance, under a different name.
For 2014/15 Class 4 will be charged at 9% on self-employed profits in excess of £7956, and up to profits of £41865. Thereafter 2% with no ceiling!
Class 1 will no longer be deducted at source from your self-employed income. Instead you must now increase your tax savings. Ensuring that you have sufficient cover for the Class 4 that will be included in your Self-assessment tax charge. The first due date will be 31st January 2016. Start saving extra now so you don’t get caught out, especially as the payments on account will be getting boosted for the same reason.
If you are unsure how much to set aside please email us at: firstname.lastname@example.org or give us a call on: 020 7717 8474.