In the recent Autumn Statement, the Chancellor announced a
significant change to National Insurance contributions (NIC) for
employees.
There will be a cut in the main rate of Employee National
Insurance from 6 January 2024. This will see Class 1 NICs reduced
by 2%, from 12% to 10%, in a change set to benefit some 27 million
employees.
This reduction will only apply to annual earnings between
£12,570 and £50,270, meaning that the maximum saving is
£754 a year. Average earners, bringing home £35,400,
will be £450 better off. As the main rate will be reduced
from 6 January 2024, employees will, unusually, see a benefit
before the start of the next tax year.
The policy paper released by HM Treasury on these changes also
highlighted further examples of the savings that this change will
create. We have listed these examples below.
