Do sole traders still pay Class 2 National Insurance in 2024/25?

From 6 April 2024, Class 2 National Insurance was effectively abolished for most self-employed people in the UK. Sole traders with profits above the Small Profits Threshold (£12,570 for 2024/25) no longer need to pay Class 2 NI contributions. However, you still build State Pension entitlement — HMRC now treats Class 4 NI contributions as also counting towards your State Pension record (as a 'deemed' contribution), so you don't lose out. If your profits are below £6,725 (the Small Profits Threshold), you do not pay any NI at all, but you may not build State Pension entitlement from self-employment. You can make voluntary Class 3 NI contributions (£17.45/week in 2024/25) to maintain your record. If your profits are between £6,725 and £12,570, you get State Pension entitlement without paying any NI — a 'zero rate' band.

• Class 2 NI effectively abolished from April 2024 for most sole traders
• Profits above £12,570: pay Class 4 NI only; State Pension entitlement maintained
• Profits £6,725–£12,570: no NI payable, but State Pension entitlement credited
• Profits below £6,725: no NI, no automatic State Pension credits; consider voluntary Class 3
• Class 3 voluntary NI: £17.45/week in 2024/25 to fill State Pension gaps