The National Insurance Number is a personal social security number that identifies individuals who live and work in the UK. A NIN must be obtained by anyone working in the UK with income equal to the amount required to pay National Insurance contributions in the UK. A NIN is necessary to take up a job. It is issued for life and cannot be changed.
Who needs a UK NIN?
The NIN is assigned to employees and the self-employed who are 16 years of age or older and who earn income from business or self-employment at a certain level.
- Employees are required to pay Class 1 UK National Insurance (NIC) contributions through PAYE when they earn more than 184GB of employment income. It’s worth knowing that contributions are voided (ie considered paid) if the employee earns an income in the range of £120 to £184. Employees can also make voluntary contributions under NIC Class 3.
- Self-employees who settle through the self-assessment system and earn an annual income of £6,515 or more are required to pay NIC Class 2 contributions. Interestingly, directors of LTD companies are required to register for the self-assessment system, but they are required to do so. They are generally categorized as employees and can pay NIC Class 1 through the PAYE system.
You should be aware that in order to receive UK benefits under a state pension, you must pay NIC Class 1 or NIC Class 2 contributions at least for a certain period of time until you reach retirement age.
In which offices is the NIN number used?
A unique NIN is used to identify a natural person for tax and insurance purposes. The number is linked to your personal HMRC tax account. It is used to communicate with offices, including:
- HM Revenue & Customs (British Tax Office),
- Department of Labor and Pensions (equivalent to the Polish Labor Office and ZUS)
- With local government units, for example in order to obtain local benefits or exemptions
- To determine the liabilities in the PAYE system – the employer uses the employee’s NIN to transfer the income tax payable and insurance premiums to the employee’s individual account at HMRC.
The NIN is used to identify many documents that are important to an employee. Located in:
- payment bars (payroll),
- P60 returns, i.e. Polish comprehensive income tax equivalents, which the employee receives from the employer at the end of the tax year;
- on tax returns,
- In official correspondence with British offices regarding tax matters and all kinds of benefits.
In short, the Personal Account NIN is assigned to every natural person who works and pays subscriptions in the UK. It is used to determine premiums paid and tax receivables and allocate them to a specific taxpayer account.
How do you get the NIN number?
The NIN is given to people who live and work in Great Britain. For directors and shareholders of LTD companies who are not resident in the UK but visiting the UK, due to their job responsibilities with UK LTD, you may find that there is a tax and insurance obligation under the PAYE system. In such cases, the foreign director of the LTD is required to obtain a NIN. It should be noted that an LTD director who provides a certificate confirming participation in social insurance in the country of residence may only be counted through the self-assessment system and does not have to be covered by British social insurance.
NIN applications can be submitted online through the UK government portal gov.uk. While applying, the form must be filled out with the details of the person applying for the NIN. You may need to attach copies of documents that prove your identity, including your passport or identity card (for citizens of the European Union, Norway, Liechtenstein and Switzerland). If the document was missing when the application was submitted, the data can be supplemented later. Applicants may be required to undergo a face-to-face interview to confirm their identity and verify their applications. We encourage you to consult the question of social security and income taxes for directors of UK limited companies.
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