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National insurance contributions Featured

national insurance contributions national insurance contributions

The Government announced last week that certain national insurance contributions (NICs) paid by both employed and self-employed workers will rise by 1.25 percentage points from April 2022. Dividend tax rates will also rise by the same amount from the next tax year. The move is in a bid to help fund health and social care costs.

Certain NIC rates will increase by 1.25 percentage points from April 2022.
From 2023, the health and social care levy element will then be separated out and the exact amount employees pay will be visible on their pay slips. It will be paid by all working adults, including workers over the state pension age – unlike other NICs.

This increase will apply to class 1 NICs paid by employees and class 4 NICs paid by self-employed workers. Class 2 self-employed NICs and class 3 NICs, which are voluntary payments made to top-up state pension gaps, are not impacted by the levy. The levy will also not be taken from pension income.

Dividend tax rates will rise by 1.25 percentage points from April 2022.
This is a tax on money given to you by a company you hold shares in, usually when it's made a profit. For those in the basic-rate band, this will increase from 7.5% to 8.75% and those in the higher-rate band from 32.5% to 33.75%.

As always, we will ensure as part of our service to you that you are compliant with all changes in regulation; whilst also maintaining tax efficiency so you don't overpay tax. If you have any questions regarding the above or any other matters, please contact your client manager or email This email address is being protected from spambots. You need JavaScript enabled to view it..

 

 

Read 30 times Last modified on Monday, 13 September 2021 17:44
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