The government has published details of the increased NICs rates, limits and thresholds to apply from 6 April 2020 in the draft Social Security (Contributions) (Rates, Limits and Thresholds Amendments and National Insurance Funds Payments) Regulations 2020.
These draft regulations specify the following:
Class 2 rate (£3.05) and small profits threshold (£6,475);
Class 3 rate (£15.30);
Class 4 lower (£9,500) and upper (£50,000) profits limits;
Class 1 lower (£120) and upper (£962) earnings limits;
Class 1 primary (£183) and secondary (£169) thresholds; and
Class 1 primary and secondary thresholds for employees under 21 and apprentices under 25.
Sarah Halsted (RSM UK) noted, in a client briefing, that: ‘31m people will benefit from the change as the NIC thresholds rise to £9,500 per year, representing an increase of more than 10%, with a typical employee paying around £104 less in 2020/21. However, as the primary and secondary thresholds for class 1 NIC had been aligned since 2017, this marks an unwelcome increase in complexity as the two NIC thresholds split apart again.’
The government has published details of the increased NICs rates, limits and thresholds to apply from 6 April 2020 in the draft Social Security (Contributions) (Rates, Limits and Thresholds Amendments and National Insurance Funds Payments) Regulations 2020.
These draft regulations specify the following:
Class 2 rate (£3.05) and small profits threshold (£6,475);
Class 3 rate (£15.30);
Class 4 lower (£9,500) and upper (£50,000) profits limits;
Class 1 lower (£120) and upper (£962) earnings limits;
Class 1 primary (£183) and secondary (£169) thresholds; and
Class 1 primary and secondary thresholds for employees under 21 and apprentices under 25.
Sarah Halsted (RSM UK) noted, in a client briefing, that: ‘31m people will benefit from the change as the NIC thresholds rise to £9,500 per year, representing an increase of more than 10%, with a typical employee paying around £104 less in 2020/21. However, as the primary and secondary thresholds for class 1 NIC had been aligned since 2017, this marks an unwelcome increase in complexity as the two NIC thresholds split apart again.’
