NIM01535 | Class 1 Structural Overview: zero-rate of secondary NICs for Freeport and Investment Zone employees: Freeport Upper Secondary Threshold (FUST) and Investment Zone Upper Secondary Threshold (IZUST)

Section 1(2)(a) and 8 of the National Insurance Contributions Act (NICA) 2022

From April 2022, a new secondary Class 1 threshold was introduced for Freeport employers, called the Freeport Upper Secondary Threshold (FUST).

Following the introduction of Investment Zones, this secondary Class 1 threshold is also available to Investment Zone employers and is known as the Investment Zone Upper Secondary Threshold (IZUST).

The FUST was set at £25,000 for the 2022 to 2023 tax year and has been frozen at that rate in subsequent tax years. The IZUST is also set at £25,000.

The FUST and IZUST cap the level of earnings at which the 0% rate of secondary Class 1 NICs applies. Earnings above this threshold will be assessed at the main secondary Class 1 rate of National Insurance. Primary Class 1 NICs remain unchanged.

The prescribed equivalents are:

• £481 per week

• £2,083 per month

You can find the NICs category letters for Freeport and Investment Zone employers at NIM01540.

The examples at NIM01570 demonstrate how the FUST and IZUST work.