National Insurance is paid by both employees and employers and helps fund benefits such as the National Health Service (NHS), state pensions, and unemployment benefits. As of the 6th of January 2024, many will see a decrease in their NI payments ...
The new National Insurance rate will benefit many employees!
The new NI rate of 10% will apply to earnings between £12,571 and £50,270, replacing the previous rate of 12%. This means that an employee on an average full-time wage of £35,000 will save about £450 a year.
"So, how does this affect you?"
You may be wondering how much you will save under the new NI rate. To find out, you can use the National Insurance calculator available partway down the page on a BBC News article. Simply enter your annual salary and the calculator will show you the amount of NI you will pay. Keep in mind that NI is not paid by individuals over state pension age.
Do remember, that the overall tax burden in the UK is increasing, with the Office for Budget Responsibility predicting that tax will reach its highest level in 70 years by 2025. This is due to a combination of factors, including the COVID-19 pandemic and the government's plans to increase spending on public services.
"The new NI rate will benefit many employees!"
While the decrease in National Insurance payments may seem like a positive change, it's important to consider the overall tax landscape in the UK. The new NI rate will benefit many employees, but other tax changes may result in higher overall tax payments.
It's crucial to plan accordingly to ensure your financial stability in the face of these changes.
Until next time ...
ROGER EDDOWES Business Godparent
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about how National Insurance is changing, it may be a great idea to call me on 01908 774320 and let's see how I can help you.
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Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
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