Spring Statement changes come into effect.
As you may have heard, there are changes happening to National Insurance contributions (NICs).
From 6 July, the new thresholds will come into effect. But what does that mean for you?
As a self-employed worker, you will already pay your National Insurance differently to that of an employee. But now your threshold is changing, you’ll need to know how much by and when.
This article will explain all the changes and what this means for you and your business.
How does National Insurance work?
Before we go into detail about how the new NICs thresholds will affect you, let’s start with an overview of the National Insurance system.
There are different classes of NICs which will vary depending on your employment status and whether you choose to voluntarily pay contributions.
Class 1 NICs are paid by employers and employees. Employees pay Class 1 NICs if they are under the state pension age and earn more than the primary threshold, in the majority of cases. These are automatically deducted by employers.
Class 1A and 1B NICs are paid directly by employers on their employees’ expenses or benefits....
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