April marks the beginning of a new financial year and with it some new changes announced by the government in Spring Statement.
This week’s big story is the announcement of an increase of National Insurance by 1.25% and to bring the threshold in line with the income tax personal allowance of £12,570.
Let’s have a look at what it means for you.
The Primary Threshold and Lower Profits Limit are the points at which both employees and the self-employed start paying National Insurance. It is raising from £9,880 a year to £12,570 from 5th July 2022, and will be the same as the personal allowance.
If you are self-employed, partner in a partnership or director of limited company, you will pay NICs on an annual basis. You will be able to earn £11.908 before paying Class 4 NICs.
Taken together, the measures mean that, over the next 12 months, anyone earning less than about £34,000 a year will pay less in National Insurance than they did the previous year, while those earning more will see their payments rise.
