National Insurance contributions to rise by 1.25% from April 2022

Employees and the self-employed will pay more tax from April 2022 to fund social care costs

At first this will be as a 1.25 percentage point increase in National Insurance. This increase will apply to Class 1 NICs paid by employees and Class 4 NICs paid by self-employed workers -and it will be administered by HMRC and collected via the current channels for NICs; Pay As You Earn and income tax self-assessment.

From April 2023 National Insurance will return to its current rate, but a new health and social care tax will be introduced at a rate of 1.25% – making up for the change to National Insurance.

On wage slips it will appear as a “Health and Social Care Levy”, the levy – unlike National Insurance – will also be paid by pensioners who work.

, , , , ,

Related Posts