National Insurance in Scotland
Complete guide to National Insurance contributions, thresholds, and how it affects your take-home pay.
What is National Insurance?
National Insurance (NI) is a form of social security contribution that funds the UK's benefits system, including state pensions, unemployment benefits, and the NHS.
Unlike income tax, which varies between Scotland and the rest of the UK, National Insurance contributions are the same across the entire UK. Both employees and employers must make NI contributions.
Employee National Insurance 2025/26
Contribution Rates
8% on earnings between £12,570 and £50,270
2% on earnings above £50,270
Example Calculation
For someone earning £30,000 per year:
Lower Earnings Limit: You don't pay National Insurance if you earn below £12,570 per year.
Employer National Insurance
Employers must pay National Insurance contributions on employees' salaries above £9,100 per year (as of 2025/26).
Employer Contribution Rate
15% on earnings above £9,100
This means employers pay contributions in addition to your salary. This is a cost to the employer and affects how much they're willing to pay in gross salary.
Class 2 & Class 4 National Insurance (Self-Employed)
If you're self-employed, you pay different National Insurance contributions:
Class 2 NI (Flat Rate)
A fixed weekly amount (currently around £163 per year) if you're self-employed and earn over the threshold.
Class 4 NI (Percentage)
A percentage of your profits (currently 8% up to £50,270, then 2% above) if you earn over £12,570 in self-employment income.
How National Insurance Affects Your Pay
National Insurance is deducted from your salary alongside income tax. For many people, NI represents a significant portion of their total deductions.
Example: On a £30,000 salary:
- Income Tax: approx £3,500
- National Insurance: approx £1,394
- Total Deductions: approx £4,894
- Take-Home Pay: approx £25,106 (84% of gross)
When combined, income tax and National Insurance can represent 15-20% of your salary for many employees.
Calculate Your Deductions
See how much National Insurance you'll pay with our free calculator.
Calculate NowFAQ
Do I have to pay National Insurance?
You pay National Insurance if you're employed and earn above £12,570 per year. Self-employed individuals pay if they earn above the threshold.
Can I opt out of National Insurance?
No, National Insurance is a statutory contribution. However, there are some exemptions for certain groups (e.g., under 16, over state pension age).
How does National Insurance count towards my pension?
National Insurance contributions count towards your state pension entitlement. Most people need 35 years of NI contributions for a full state pension.