For the 2026/27 UK tax year, a self-employed individual has profits of £6,000, below the relevant Class 2 threshold of £7,105. They want that year to still count towards their National Insurance record for state pension purposes. Under current HMRC rules, which statement is correct?
- Class 2 contributions are compulsory regardless of profit level, so they must pay Class 2 either way
- Because profits are below the relevant threshold, no National Insurance credit is given automatically unless they choose to pay voluntary Class 2 contributions
- Class 4 contributions automatically substitute for the missing Class 2 record
- Profits below the threshold automatically qualify for a full National Insurance credit with no payment required
Correct answer: B. Because profits are below the relevant threshold, no National Insurance credit is given automatically unless they choose to pay voluntary Class 2 contributions
Since compulsory Class 2 National Insurance was removed for the lower-profits band, self-employed individuals with profits at or above the relevant threshold of £7,105 have their National Insurance record treated as paid automatically at no cost, but those below it, like this individual at £6,000, receive no automatic credit and must actively choose to pay voluntary Class 2 contributions if they want that year to count towards their state pension and other contributory benefits, which is what the second option correctly describes. The first option is wrong because Class 2 is no longer compulsory at any profit level under the current rules. The third option is wrong because Class 4 is a separate charge that only applies to profits above its own lower profits limit and has no mechanism for crediting the basic National Insurance record in place of Class 2. The fourth option is wrong because profits below the threshold do not generate an automatic credit; a voluntary payment is required to secure it.
Source: GOV.UK: Self-employed National Insurance rates — Class 2 contributions and voluntary payment