<Tr> <Td> <Ul> <Li> </Li> <Li> </Li> <Li> </Li> </Ul> </Td> </Tr> <Ul> <Li> </Li> <Li> </Li> <Li> </Li> </Ul> <P> In the United Kingdom, National Insurance (NI) is a system of taxes paid by workers and employers, used primarily to fund state benefits . It was initially a contributory system of insurance against illness and unemployment, and later also provided retirement pensions and other benefits . It was first introduced by the National Insurance Act 1911 and expanded by the Labour government in 1948, and has been subject to numerous amendments in subsequent years . </P> <P> The contributions component of the system, "National Insurance Contributions" (NICs), is paid by employees and employers on earnings, and by employers on certain benefits - in - kind provided to employees . The self - employed contribute partly by a fixed weekly or monthly payment, and partly on a percentage of net profits above a certain threshold . Individuals may also make voluntary contributions, in order to fill a gap in their contributions record and thus protect their entitlement to benefits . Contributions from those in employment are collected by HM Revenue and Customs (HMRC) through the PAYE system, along with Income Tax, repayments of Student Loans and any Apprenticeship Levy which the employer is liable to pay . </P>

Why do we pay national insurance in the uk