This week (22nd September 2022) the government announced in-year reductions to National Insurance rates and the cancellation of the Health and Social Care Levy as a separate tax.
What does this mean?
The key changes are:
- National Insurance contribution (NIC) rates will be cut by 1.25 percentage points for employees, employers and the self-employed, effectively reversing the uplift introduced in April 2022 for the rest of the tax year. This cut will take effect from 6 November 2022 and it will cover Class 1 (both employee and employer), Class 1A , Class 1B and Class 4 (self-employed) NICs
- The ring-fenced Health and Social Care Levy of 1.25% due to be introduced from April 2023 will also not go ahead
Previously employers and software developers had been asked to include a temporary generic message on payslips for the tax year (2022 to 2023) to explain the reason for the NICs uplift. This message will no longer be applicable from 6 November 2022, and will be removed from payslips with effect from this date.
The full detail on all of these changes, published by HMRC is available on the GOV.UK website HERE.
If you have any queries relating to this update do not hesitate to contact our Team.
