The Autumn Statement 2023, set out by Jeremy Hunt, brought about many changes, including changes to National Insurance and its policies.
If you unsure of what National Insurance is, it is a policy that means you financially contribute to benefits and pensions set out by the Government in order to qualify for specific benefits and the State Pension too.
Understanding the changes can significantly benefit you and make sure you are receiving exactly what you pay for.
What are the changes?
In the Autumn Statement 2023, three changes were made to National Insurance Contributions (NICs), with some applying from January 2024.
NICs are usually an obligation but, with the changes from the Autumn Statement, they now become a tax-cut for employees and self-employed individuals.
The changes are:
These measures will extend and apply to the entirety of the UK, regardless of reason.
How do they affect me?
For you as a taxpayer, the change in National Insurance benefits rather than disadvantages you.
Around 27 million employees and over two million self-employed people will benefit overall from the new changes.
Let’s break down the benefits:
Remember:
Although the percentage of the main rate of NICs paid, by both employees and self-employed individuals, has decreased, you still do not have the option to opt-out of the scheme or decide how much is paid into the pension itself.
What to do next?
Whilst we know the new changes to National Insurance are confusing and seem like they are a million miles away, it is important you understand the changes before they take effect so that you are making the most out of your contributions.
You need to prepare for the changes when they take effect next year, with the earliest change starting from January 2024. If you need help regarding your pension and what to do, it is always best to consult an accountant for advice.
If you are unsure about the recent changes, click on here for further information.
For help and guidance surrounding National Insurance, get in touch with one our expert team members today.