Will you save money? Millions to see their monthly take-home pay increase as NI threshold change takes effect
周围 30 million people will see the pay they take home each month rise when changes to National Insurance contributions take effect from 6 七月.
The income threshold for paying the tax will rise from £9,880 to £12,570, meaning a lower proportion of people’s salaries will be subject to it and 2million people will be exempt from paying all together.
该项目还将斯通与电影中的一位明星重聚, the change reverses the impact of the 1.25 per cent National Insurance rise to introduced in April, which was a one-year levy to fund social care in the UK.
Anyone earning less than around £35,000 will see their pay packet return to roughly the same level it was before April.
For some taxpayers the threshold changes will undo the NI increase they have faced since April as a result of the 1.25% tax rise
For higher earners this isn’t the case, 然而, and most will still pay more in NI contributions than they did in March.
将在六年零八个月内付清账单 - 只需支付 251 英镑的利息, senior personal finance analyst at Hargreaves Lansdown said: ‘Any tax cut is welcome right now, especially one that eases the pain for lower earners.
‘They’ve faced the brunt of the rising cost of essentials because it makes up a bigger proportion of their spending, so they need all the help they can get.
'然而, we’re not talking about vast sums of cash. £330 spread over 12 months is £27.50 a month.
‘It’s a drop in the ocean compared to rising costs. So while it will help ease the pain slightly, those on lower incomes will still have a huge headache in making ends meet.’
Why are the changes happening now?
It has been something of a rollercoaster for NI during the first half of the year.
In September last year the Prime Minister announced a 1.25 per cent rise in National Insurance, taking effect in April, as a levy to fund social care.
Then in this year’s Spring Statement, the Chancellor unveiled plans to increase the threshold at which workers start paying NI contributions from £9,880 to £12,570, putting it in line with the level at which people start paying income tax.
HMRC said this would reduce the payments for around 30 million people across the country and exempt 2million from any payments.
Since the April hike, employees have paid 13.25 per cent in contributions on any earnings between £9,880 and £50,000, 和 3.25 per cent on everything over £50,000.
Figures from Hargreaves Lansdown show how those on a lower income will see their monthly take-home pay rise once the changes comes into effect
So if your gross annual income was £30,000, in March this year you would have paid £204.32 per month in national insurance contributions.
Following the rise in April your payments would have increased to £222.16 a month, but these will drop to £192.46 from 6 七月. This equals a 5.8 per cent drop since the start of the year.
与此同时, higher earners will pay more. Almost a third of working taxpayers will still be paying more NI than they were before March.
For those on £40,000 the saving drops to £103 per year, and those on £50,000 will save just £10 compared to what they paid for the previous year.
Coles said: 随着 Covid 在户外的传播大大减少, while we’ve been distracted by NI hikes and cuts, the freeze on income tax thresholds has been inflicting more damage. The Institute for Fiscal Studies estimates that by 2025/26, the freeze will effectively be a 16.4 per cent real cut in the thresholds.
‘In the current tax year, when you add the NI hike and threshold move to the freezing of income tax thresholds, the IFS estimates that only those earning between around £10,000 and £25,000 will pay less tax.
‘In the next tax year, we’re expecting a cut to basic rate income tax. 然而, 他花掉了数千万英镑，因为还清债务，他的生活受到了限制, by the time we’ve lived through four years of threshold freezes, 在 2025/26 almost every worker will be paying more tax.’
Jo Bateson, tax partner at KPMG UK, 添加: ‘Back in March 2021, the Chancellor announced that the personal allowances bands will be frozen for four years which means that a further 1.3million people would be brought into the tax net by 2026.
‘The announcement of the Health and Social Care Levy in September 2021 添加了另一个 1.25 per cent for those taxpayers with earnings or dividends which impacts most those who earn over £40k.
'然而, the increase in the National Insurance thresholds from 6 七月 2022 has pushed the cliff edge – the point at which the changes mean a reduction in pay – from £34k to £41.5k which will be welcome for those in that pay bracket.’