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ACCA Strategic Professional · Advanced Taxation (UK) · National insurance contributions for employed and self-employed persons

Which of the following statements about the Class 1A NIC rate and the employment allowance for 2026/27 is correct?

Class 1A NIC is charged at 15% on the employer, and an eligible employer can set the £10,500 employment allowance against its employer NIC liabilities, including Class 1A. The £5,000 secondary threshold does not apply to Class 1A.

  1. AClass 1A is charged at 15% and the £10,500 employment allowance may be set against itCorrect
  2. BClass 1A is charged at 13.8% and no employment allowance can be set against it
  3. CClass 1A is charged at 15% and the employer can deduct the £5,000 secondary threshold
  4. DClass 1A is charged at 8% and the employee bears it

Explanation

Class 1A is 15%, an employer-only charge. The employment allowance of £10,500 can be used against employer NIC liabilities, including Class 1A, where the employer is eligible. The £5,000 threshold applies only to Class 1 secondary contributions.

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