• Posted 2nd August 2015

National Insurance Contributions

As National Insurance (NI) is a tax paid on earnings and self-employed benefits, anyone residing in the UK must be familiar with this term. If you are employed, National Insurance is automatically deducted from your monthly pay. On the other hand, you have to make contributions yourself if you are self-employed. However, all of you may not be aware about every benefit you are entitled to when you pay such National Insurance. To ensure you get to enjoy your contributions, here is a list of benefits that you need to know. Jobseeker’s allowance You are entitled to contribution based Jobseeker’s allowance (JSA) if you have paid or been credited with plenty National Insurance Contributions (NICs) over the last two tax years. If you are not eligible for contribution based JSA, you may be eligible for income based JSA. When you get such benefit, your payments might be reduced if you have income from part-time employment. Employment and support allowance This is a benefit which is available if you have a physical or mental illness and won’t be able to work. However, you must have actually paid enough NICs in the last two tax years before the year in which you make claims in. Also, credited NICs may not always apply in this condition. Bereavement benefits When your husband, wife or civil partner dies, you are given Bereavement benefits. Such allowance depends on the NI contributions made by your partner. In case if your husband, wife or civil partner has not made contributions or credits for the right number of years, a reduced rate of Widowed Parent’s Allowance or Bereavement Allowance will be given to you. This type of widowed parent's allowance is paid from the time of death while the surviving spouse is pregnant or has to take care of dependent children. In case if you remarry, then you are not eligible for such allowance. If you do not have dependents, this allowance is paid to those aged between 45 and state pension age for a year after death. To get all this bereavement benefits, enough contributions should be made by the partner in any tax year before he/she dies.