NIM01306 - Class 1 structural overview: abolition of secondary NICs for apprentices under the age of 25: background

Section 9B of the Social Security Contributions and Benefits Act (SSCBA) 1992

In April 2016, the National Insurance Contributions Act 2015 introduced Section 9B into the SSCBA. The secondary Class 1 rate of National Insurance will be 0% for certain apprentices under the age of 25. The 0% rate will apply to earnings between the Secondary Threshold (ST) and the Apprentice Upper Secondary Threshold (AUST). See NIM01309 for further information about the AUST.

The definition of what constitutes a qualifying apprentice can be found at NIM01307.

The change will apply to new and existing apprenticeships. New category letters (see NIM01310) have been introduced to correctly assess Class 1 NICs for apprentices under the age of 25.

Although the secondary Class 1 rate of NICs is 0%, the employer will remain a secondary contributor and will continue to have liability to operate statutory payments for employees.