Written and reviewed by James Whitfield · Updated for 2026/27 · Editorial standards · Methodology
What each National Insurance category letter means, who it applies to, the 2026/27 employee and employer rates for each, what a wrong letter costs at £30,000, and how to get it fixed.
Your National Insurance category letter is on your payslip and tells payroll which NI rates to use1. A is the standard letter: 8% between £12,570 and £50,270 and 2% above in 2026/27. M (under 21), H (apprentices under 25) and V (veterans) pay the same as A but their employer pays less. C (over State Pension age) pays no employee NI, B pays 1.85%, and J and Z pay 2%2.
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Typical default outputs for quick context.
| Letter | Who | Employee £12,570–£50,270 | Employee above £50,270 | Employer |
|---|---|---|---|---|
| A | Most employees | 8% | 2% | 15% above £5,000 |
| B | Married women and widows with a reduced-rate election | 1.85% | 2% | 15% above £5,000 |
| C | Over State Pension age | 0% | 0% | 15% above £5,000 |
| H | Apprentices under 25 | 8% | 2% | 0% up to £50,270, then 15% |
| J | Deferring NI because you pay it in another job | 2% | 2% | 15% above £5,000 |
| M | Under 21 | 8% | 2% | 0% up to £50,270, then 15% |
| V | First civilian job after the armed forces (veterans) | 8% | 2% | 0% up to £50,270, then 15% |
| Z | Under 21 and deferring | 2% | 2% | 0% up to £50,270, then 15% |
| X | Not liable to pay NI, e.g. under 16 | None | None | None |
Freeport and Investment Zone special tax sites use their own letters (F, I, L, S and N, E, D, K). Employees who are not working in a special tax site should have one of the standard letters above12.
The same £30,000 salary gives very different NI bills depending on the letter, because the letter sets the employee rate between the £12,570 primary threshold and the £50,270 upper earnings limit2.
| Letter | Rate on £17,430 (£30,000 − £12,570) | Employee NI a year |
|---|---|---|
| A, H, M or V | 8% | £1,394.40 |
| B | 1.85% | £322.45 |
| J or Z | 2% | £348.60 |
| C | 0% | £0.00 |
The employer side differs too: on letter A the employer pays £3,750.00 on £30,000 ((£30,000 − £5,000) × 15%); on M, H, V or Z it pays nothing below £50,270. On £60,000 that is £1,459.50 for an under-21 against £8,250.00 on letter A.
National Insurance is worked out pay period by pay period, so a letter that is wrong for some months affects those months only. A tax code change does not alter NI.
Current tax-year thresholds used across this guide and calculator.
A. It covers all employees apart from those in groups B, C, H, J, M, V and Z.
Category M is for employees under 21. You pay the same 8% and 2% as letter A, but your employer pays no NI on your earnings up to £50,270.
C. Employees over State Pension age pay no employee National Insurance. The employer still pays 15% above £5,000.
J is for employees who can defer National Insurance because they already pay it in another job. They pay 2% on all earnings above £12,570 in that job instead of 8%.
No. It only changes National Insurance. Income tax depends on your tax code.
Ask payroll to correct it. For an earlier tax year where you paid too much, HMRC has a National Insurance refund service on GOV.UK.
The rates, thresholds and rules on this page are drawn from the official UK government sources below, using the confirmed 2026/27 figures. Each link opens the relevant HMRC or GOV.UK page in a new tab.
Verified against published UK government guidance for 2026/27.