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Muddled outcome
Key points
- The increase in the lower threshold where National Insurance contributions are paid will take effect from July 2022.
- From April 2023 the NIC rates will reduce again and the health and social care levy will appear as a separate line on employees’ payslips.
- The change does not apply to employers’ contributions.
- The government estimates that a typical employee will save £330 in the year from July.
- Will the alignment of the tax and National Insurance thresholds be permanent?
One of the headline-grabbing comments arising from the government’s Spring Statement was the increase in the lower threshold where National Insurance contributions (NICs) are paid which will take effect from July 2022.
However as is usually the case when such a fundamental change is announced so close to the beginning of the tax year it will take a while to implement the changes to pre-programmed payroll software....
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