National Insurance after State Pension age

Once you reach State Pension age you stop paying employee Class 1 National Insurance on pay you receive after that date, even if you keep working, but your employer must still pay employer contributions at the normal rate. If you are self employed, Class 4 continues until the end of the tax year in which you reach State Pension age and stops from the following 6 April.

Why do employees stop paying at State Pension age?

The rule is in section 6(3) of the Social Security Contributions and Benefits Act 1992: except as prescribed, no primary Class 1 contribution is payable on earnings paid to an employed earner after they reach pensionable age, but this is without prejudice to any liability for secondary Class 1 contributions. In other words, the exemption is personal to the employee. The employer’s liability is untouched.

The test looks at when earnings are paid, not when they were earned. Pay received after you reach State Pension age carries no employee contributions, even if it relates to work done earlier. Pay received before you reach it is charged in the normal way, even if it covers a period afterwards. This makes the timing of bonuses and final salary payments around the birthday worth checking.

What does the employer still pay?

GOV.UK’s employer guidance says that when an employee reaches State Pension age the employer changes their National Insurance category letter to C, which stops employee deductions, but must still pay employer contributions. The 2026 to 2027 rates table shows category C at nil for the employee and 15% for the employer on earnings above the secondary threshold of £96 a week (£5,000 a year). Category S and category K are the equivalents for employees over State Pension age working in a special tax site within a Freeport or an Investment Zone.

Class 1A on benefits in kind is paid by the employer, so it continues too. See our guide to Class 1A National Insurance.

Illustration: a part time worker over State Pension age

Illustration only. Graham is over State Pension age and earns £600 a week in 2026 to 2027.

• Employee contributions: nil, because his category letter is C.
• Employer contributions: 15% of £504 (£600 less £96), which is £75.60 a week.

Had he been under State Pension age on category A, he would also have paid 8% of £358 (£600 less £242), £28.64 a week.

What does the employee need to do?

The change is not automatic in payroll. GOV.UK says you should show your employer proof of age, such as a birth certificate or passport. If you do not want your employer to see those, you can write to HMRC at National Insurance Contributions and Employer Office, HM Revenue and Customs, BX9 1AN, explaining why, and HMRC can send a letter confirming you have reached State Pension age and do not need to pay. A certificate of age exception (CA4140) can still be shown if you have one, but GOV.UK says these are no longer issued.

The employer’s guidance adds that it should keep reporting the year to date figures under the old category letter until the end of the tax year, with the new letter used for pay after the change.

What about the self employed?

Regulation 91 of the Social Security (Contributions) Regulations 2001 excepts from Class 4 anyone who is over pensionable age at the beginning of a year of assessment. That is why Class 4 does not stop on the birthday: it stops for the first full tax year that starts after it.

GOV.UK gives this example: if you reach State Pension age on 6 September 2026, you stop making Class 4 contributions from 6 April 2027, and pay your final Class 4 bill by 31 January 2028 with your Income Tax. You still need to send a Self Assessment return for each year you work after State Pension age.

For 2026 to 2027 Class 4 is 6% on profits between £12,570 and £50,270 and 2% above that. Class 2 is no longer compulsory, and GOV.UK says that after State Pension age your Class 2 contributions are no longer treated as paid. Our guide to self employed National Insurance covers the rules for earlier years.

What happens in the year you reach State Pension age?

Several rules interact in the transition year:

• Employees: employee contributions are due on pay received before the date and stop on pay received after it.
• Self employed: Class 4 is due on the whole of that year’s profits.
• Several jobs: the CA72A notes say HMRC does not usually allow deferment of Class 1 in the tax year you reach State Pension age. Regulation 16 of the 2001 Regulations also stops earnings paid in that year, but normally due in a later year, from being aggregated with other earnings (NIM10007).
• The age itself is moving: State Pension age is rising to 67, phased in between May 2026 and February 2028 for people born between 6 April 1960 and 5 March 1961, so the date you stop paying may be later than you expect.

What if contributions were deducted after State Pension age?

This usually happens when the employer was not shown proof of age in time. If it is spotted in the same tax year, HMRC’s guidance at NIM37013 says the employer corrects it through payroll. For a recently ended year, NIM37014 says the employer sends a further Full Payment Submission with corrected year to date figures and refunds the employee directly, or asks HMRC for a refund if that is not possible.

Otherwise, GOV.UK says you can claim back overpaid National Insurance from HMRC. Class 1 paid in error has a six year time limit under regulation 52(8), running from the end of the year in which the contribution was due (NIM37003). Our guide to National Insurance refunds explains the process.

Does Income Tax stop too?

No. Only National Insurance stops. GOV.UK says you still pay Income Tax if your taxable income, including your State Pension and any private pension, is more than your allowances. The State Pension is taxable but paid without tax deducted, which usually means it is collected through your wages or a private pension. See our guide on whether the State Pension is taxable.

Common mistakes

• Not giving the employer proof of age. Deductions continue until the category letter is changed.
• Stopping employer contributions as well. Category C removes only the employee’s share.
• Self employed people stopping Class 4 on their birthday. It runs to the end of that tax year.
• Assuming the old State Pension age. Check the date for anyone born from 6 April 1960 onwards.

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Related Accountapedia entries

• Deferring Class 1 National Insurance
• National Insurance category letters
• The married women’s reduced rate election
• National Insurance classes explained
• Employer National Insurance at 15%: how it works
• Employer NI reliefs for young staff, veterans and freeports

Sources

• legislation.gov.uk: Act 1992 c. 4, section 6
• GOV.UK: Employee reaches state pension age
• GOV.UK: Rates and thresholds for employers 2026 to 2027
• GOV.UK: Category letters
• GOV.UK: Print
• legislation.gov.uk: SI 2001/1004, regulation 91
• GOV.UK: How much you pay
• GOV.UK: National insurance application for deferment of payment of class 1 nat
• GOV.UK: Manual page NIM10007
• GOV.UK: Manual page NIM37013

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 8 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.