Run it properly
Social Security, as an owner in
Why owners pay Class 2, why it follows your income from two years ago, the bill you get by doing nothing — and the ways to pay less while you start.
In Jersey, owners and directors of their own company pay Social Security like the self-employed: Class 2, worked out from what they earned two years before.
The surprise most new owners get is a bill set by an old year — or the maximum, because they never sent the form. Plan for it before you take your first payment.
What nobody tells you
- Doing nothing is the most expensive choice: no tax assessment sent means the maximum bill.
- An exemption is not free: it leaves a gap in your pension record unless you choose to pay.
- The Startup Plan is reviewed two years later — earn more than its base and a bill for the difference follows.
- 3 Before you apply · 43%
- 1 Applying · 14%
- 2 Straight after · 29%
- 1 Every year, and every change · 14%
- 4 You · 57%
- 3 Done for you · 43%
Move along the chart to read any income.
The figures, as a table
| Income | Income tax | Social Security |
|---|---|---|
| £20,000 | £0 · 0.0% | £2,500 · 12.5% |
| £40,000 | £4,875 · 12.2% | £5,000 · 12.5% |
| £60,000 | £10,075 · 16.8% | £7,500 · 12.5% |
| £80,000 | £15,275 · 19.1% | £9,274 · 11.6% |
| £100,000 | £20,000 · 20.0% | £9,774 · 9.8% |
| £120,000 | £24,000 · 20.0% | £10,274 · 8.6% |
| £140,000 | £28,000 · 20.0% | £10,774 · 7.7% |
| £160,000 | £32,000 · 20.0% | £11,274 · 7.0% |
| £180,000 | £36,000 · 20.0% | £11,774 · 6.5% |
A single person with no other allowances: tax is the lower of 20% of income and 26% of income above £21,250. 
You pay it as an owner, not an employeeYou
If your own company pays you, or you own 50% or more of its shares, Social Security treats you as a Class 2 contributor — like a sole trader. Owning less can still count, if you can stop the business, control its money or appoint most of its directors.
It is worked out from your income two years agoDone for youSocial Security
Not from what the business earns now: your Class 2 rate is based on your earned and unearned income from two years before, recalculated every January from your latest tax assessment. A good year is paid for two years later — budget for it.
How much: 12.5%, then 2.5%, then nothingDone for you
12.5% of your income up to £72,744 a year — at most £757.75 a month — then 2.5% of income from there up to £331,584, and nothing above that. The most anyone pays is £1,297 a month.
Send your tax assessment — or pay the maximumYouSocial Security
Moving from being employed to Class 2, send Social Security your tax assessment to get a reduced rate. If they do not hear from you, you pay the default monthly rate — £1,297 in 2026. If you do not file your tax return at all, your contribution is set to the maximum.
Little income two years ago? You may be exempt — at a costDone for youSocial Security
If your earnings two years ago were under the lower earnings limit — £1,296 a month in 2026 — you are sent a letter confirming you are exempt. It leaves a gap in your contribution record, which can affect your pension and benefits; you can choose to pay instead, to protect it. A full month’s contribution at that limit is 12.5% of £1,296: £162.
Or the Startup Plan, for the first two yearsYouSocial SecurityRe-apply 16 January to 28 February
If you are self-employed, opened the business in the last two years and hold a business licence, you can pay a fixed £252.58 a month in 2026 — 12.5% of a base income of £24,248 — instead of a rate set by your income two years ago. You re-apply each year between 16 January and 28 February, and two full years are allowed. Two years later your real income is checked: earn more than the base and you pay the difference; earn less and you may be refunded.
Paid every month, recalculated every JanuaryYouSocial Security
Class 2 is billed monthly — a direct debit is easiest — and your new amount is set each January. Tell Social Security straight away if your situation changes, such as becoming employed again.
What you do not need
- To pay on profit the company keeps and does not pay you: it is your own income that counts.
Our advice, in plain words
- Before you take your first payment, decide how you will pay Social Security, and set aside 12.5% of everything you pay yourself.
- File your tax return every year, on time: your contribution rate is built from it.
Advice from experience — the steps above are the rules.
Keep going
- Register for data protectionIf you hold customers’ names or emails, you register with your regulator — and you have duties after.Open
- GST and VATWhen a sales tax applies to you, and when it does not apply at all.Open
- Take card paymentsA payment account in your business’s name, with a provider that takes businesses where you are.Open
- All of it, in orderPlan my start draws every journey you need, for your place, with your costs.Plan my start
Words in this journey:DirectorBusiness licenceClass 2 contributionsSole traderLimited company