More National Insurance?

[GuavaHalf]

I am currently employted and earn a significant amount of money so I am paying the maximum NI contributions already (+1% on amounts over the upper limit). I am going to start my own business as a sideline. I will continue to work full time with the same salary. My question is with regard to NI contributions - will I be liable for Class 2 and Class 4 contributions even though I am already paying the maximum under class 1?

[kags]

If you are already paying the maximum contributions at 11% on your salary as you say, then you can apply for deferment of Class 2 and Class 4 contributions. The Inland Revenue will then look at your contributions at the end of each year, and if you have paid too little (for instance if your salary drops so that you are no longer paying the maximum at 11%, they will ask you to make up the difference. As there is no ceiling on the 1% Class 4 contributions, you will need to calculate contributions at 1% when you submit your tax return, then the NI deferment service will let you know if you owe anything further. This link should take you to Inland Revenue leaflet CA72 which has an application form for deferment at the back. You need to apply before the end of the tax year. http://www.inlandrevenue.gov.uk/leaflets/ca72-2004.pdf