Increase in National Insurance Contributions from April 2022

From April 2022, there will be a temporary 1.25% increase in Class 1 primary (employee), Class 1 secondary (employers) and Class 4 (self-employed) NIC.

From April 2023, these increases will be legislated separately as a “NHS Levy” and NIC rates will return to 2021/22 levels. The NHS Levy will also extend to individuals working above state pension age, who are currently exempt from NIC :-

Type Of NIC Thresholds2021/22 Rates2022/23 Rates2023/24 Rates
(Class 1)
£956812%/2%13.25%/3.25%12%/2% plus

1.25% NHS Levy
(Class 1)
£884013.8%15.05%13.8% plus

1.25% NHS Levy
Self employed
(Class 4)
£95689%/2%10.25%/3.25%9%/2% plus

1.25 NHS Levy

From 6th April 2022 dividend income will also be subject to the NHS Levy. The £2,000 allowance remains. The additional levy will affect all levels of income as per the table below :-

Tax Bracket2021/22 Rates2022/23 Rates
Basic Rate7.5%8.75%
Higher Rate32.5%33.75%
Additional Rate38.1%39.35%

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