Consider paying voluntary Class 2 NI via your 2021/22 tax return. 
Class 2 NI is paid by the self-employed. If your profits were adversely affected by the pandemic in 2021/22, you might be below the small profits threshold. How can you ensure you preserve your entitlement to the state retirement pension if so affected? 
Self-assessment collects tax and NI from self-employed individuals, including Class 2 NI. 
A key point that should be considered when filing your tax return for 2021/22 ahead of next week's deadline if your business profits are below the Class 2 NI threshold , which for 2021/22 was £6,515., is whether to pay the NIC voluntarily. 
With many businesses still in recovery from the pandemic, you may find that your profits don’t exceed this, meaning you don’t need to pay the £3.05 per week fixed amount. This seems like good news. However, unless you are also paying Class 1 NI, e.g. because you are employed as well, Class 2 NI is the only way of securing a qualifying year toward your state retirement pension. Low profits mean you can miss out on accruing further entitlement. Fortunately, there is a solution. 
You can choose to pay Class 2 NI voluntarily where your profits are below the payment threshold. If you submit your own return, you will be asked if you wish to do this as part of the self-employment section. If you use an accountant, let them know if you wish to do this. 
If you have already submitted your return, and want to use the solution, you can amend it to include the modest (approximately £159) amount, but you must do this by 31 January 2023 and pay the amount by that date too. 
HMRC will not accept an amendment for voluntary Class 2 NI after that date. 
Tagged as: General, Self employment
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