Employers use an employees National insurance Category Letter to calculate the amount of NI due. Depending on the age and circumstance of an employee depends on the National Insurance letter used. Below are the NI category letters and who they apply to,
A- All employees apart from those in any of the below Categories
B- Married women and widows entitled to pay reduced National Insurance
C- Employees over state Pension Age
J-Employees who can defer National Insurance because they are already paying it in another job
H- Apprentice under 25
M- Employees under 21
Z- Employees under 21 who can defer National Insurance because they are already paying it in another job
X- Employers can use Category letter X for employees who do not have to pay NI for example because they are under 16
