3

My google-fu is failing to find me a straight answer to this one, perhaps because the merging of some NIC payments with self-assessment is relatively recent and there's a lot of old info out there:

If someone has both regular employment (employer paying a PAYE salary big enough to be in higher-rate tax band, and employer NICs) and a small "hobby" self-employment income (below the £5965 small earnings threshold) conventional wisdom is there are no class 2 NICs due. The self assessment form includes the option of paying class NICs 2 voluntarily with a warning about not doing this could threaten entitlement to state pension and other benefit entitlements. But in this situation, surely the regular employment's NI contribution is sufficient to keep the contribution record (what previous generations might have called their "stamps") intact?

Would it be a good idea for someone in this situation (assuming they do want to maximise their state pension) to pay the class 2 NICs voluntarily, or is there really no need?

1

If you're paying class 1 NI via PAYE then there is no benefit in voluntarily paying class 2 as well. Your class 1 contributions get you everything that class 2 does (and more - class 1 builds up an entitlement to contributions-based JSA which class 2 does not).

The warning on the SA form is aimed at people whose only or main income comes from self-employment.

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