Following the announcement in the spring that the National Insurance (NI) threshold will increase for the 2022/23 tax year, HMRC has updated the guidance on the changes that are due to come into effect from 6 July 2022.
The Class 1 National Insurance contributions threshold will increase from £9,880 to £12,570, which will align with the income tax personal allowance.
Why not try this very helpful HMRC link to a calculator tool to get an estimate if you’re employed and paid the same amount monthly, by your employer through the PAYE system.
Estimate how the National Insurance contributions changes will affect you – GOV.UK (www.gov.uk)
The tool will estimate how the changes to the Primary Threshold and the Health and Social Care Levy will affect the amount of National Insurance contributions you pay.
Before you start
You will not get a useful result if you have different working arrangements for the period from 6 July 2021 to 5 July 2023, including if:
- you’re not liable to pay the main rate of UK Class 1 National Insurance contributions at the standard rate on your earnings or profits — for example:
- you’re over state pension age
- you’re self-employed
- you pay the reduced rate
- you work outside the UK
- you have either more than one employer or you’re not evenly paid all of your earnings in a monthly payment (or both) — for example:
- you get a bonus
- you’re paid commission
- you’re paid weekly
- there is, or will be, a change in your circumstances which affects the amount of UK National Insurance contributions you pay in the period — for example, you get a pay rise or change employers
- you’re a director
As the increase does not come into effect until part way through the 2022/23 tax year the two will not fully align until 2023/24.
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