Use the Correct National Insurance Letter to pay the correct amount

With the 1.25% increase in National Insurance Contributions (NICs) from 6 April 2022 to help fund health and social care it is important that employers use the letter that is appropriate for that employee.

This is particularly important where you employ apprentices under the age 25 (H) and other employees under the age of 21 (M) as there are no employer contributions where the employee is paid no more than £50,270 a year. Although the employee pays 13.25% on earnings above the 15.05% employer contributions are not payable. This is clearly designed to encourage employers to take on apprentices and young adults.

Five new NIC letters are being introduced from 6 April 2022 for military veterans (V) and employees working in a designated Freeport area (in most cases F). Note that the exemption from employers NIC for military veterans only operates for the first 12 months of their civilian employment and the exemption for Freeport workers applies for 36 months. In each case after that initial period the normal NIC letter should apply to that employee.

There are three further NIC letters for workers in Freeport areas with special circumstances.

Check the tables below for the correct letter!


Category letter

Employee group


All employees apart from those in groups B, C, J, H, M and Z in this table


Married women and widows entitled to pay reduced National Insurance


Employees over the State Pension age


Employees who can defer National Insurance because they’re already paying it in another job


Apprentice under 25


Employees under 21


Military veterans in first 12 months of civilian employment


Employees under 21 who can defer National Insurance because they’re already paying it in another job