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State Retirement Pensions: Self-employed

Question for Department for Work and Pensions

UIN 69620, tabled on 28 March 2017

To ask the Secretary of State for Work and Pensions, what assessment he has made of the Government's decision to abolish Class 2 national insurance contributions on the ability of self-employed people to access a full state pension.

Answered on

5 April 2017

Following the abolition of Class 2 National Insurance contributions from 2018/19 the self-employed will continue to have access to the new State Pension. Self-employed people with annual profits above a new Small Profits Limit will gain access to the new State Pension based on Class 4 National Insurance contributions. The Small Profits Limit will be set at the same level as the annualised Lower Earnings Limit for employees which is £5,876 in 2017/18. Those with profits below the Small Profits Limit who don’t already have a full National Insurance contribution record will be able to access the new State Pension through earnings subject to payment of Class 1 Primary (employee) contributions; National Insurance credits; or payment of Class 3 voluntary contributions.