With the recent surge in cost of living prices, it’s easy to miss other important news that you need to take notice of! So, in today’s blog, we will discuss the National Insurance changes and what that could mean for you.
What are the changes?
It has been announced that from April 6th employers, employees and the self-employed will pay an increase of 1.25p for National Insurance.
But why the change?
Why the increase?
The increase of tax will go towards the NHS and funding health and social care in the UK.
The Government stated that the extra funding will firstly go towards the NHS and easing the pressure due to the pandemic while a selection of it will later be put into social care to help with staff shortages etc.
You may be wondering, how much will the increase be for me?
Well, for those earning £50,000, they will pay £197 more.
Those who earn £80,000 will have to pay £572 more and those earning £100,000 will have to pay £822 more.
People who earn £20,000 will pay £178 less while those who earn £30,000 will earn £53 less.
For those over the state pension age, this does not apply to you.
When could it go back down?
It’s expected that the rate will go down from April 2023 and onwards matching similar rates to the 2021-22 levels.
How can we help?
If you’re still a bit confused as to what this all means do not worry. On our Useful Resources tab is a number of PDF documents breaking down all aspects of tax, including National Insurance Rates.
We have a PDF on National Insurance Rates with a breakdown for employees and the self-employed to give a clear insight into how this affects you and clears any confusion.
Along with this, there is a breakdown of Income Tax Rates, including a breakdown of what goes into this, such as Allowances, Rates bands and Tax rates.
You can find these documents as well as many more here
If you have any further questions about this and how it affects you or your business, then feel free to get in touch and our friendly team will be happy to talk it through with you!