The increase of National Insurance back in April 2022 was raised by 1.25% and meant to last for a year, the plan being to replace this increase with Health and Social Care Levy from April 2023,
This will be reversed from 6th November 2022, and the Health and Social Care Levy will no longer being forward.
As a result, from 6th November 2022 NI rates will revert to:
Class 1 Employee’s NI: 12%
Class 1 Employer’s NI: 13.8%
Class 4 NI for the self-employed: 9% (Will remain unchanged from the last reform)
Employees will see changes take effect from their first packet after November 6th whose NI is calculated on a monthly basis. HMRC advises those who pay NI on an annual basis (self-employed and company directors) will pay revised annualised rates of NI. This new rate is yet to be announced.
Increase in tax rate on dividends reversed In April 2022 rate of Income Tax billed on dividend income was also increased by 1.25%, this is to be reversed from April 2023, reverting back to 7.5% and 32.5% for basic-rate and higher-rate taxpayers.
25% Corporation Tax rise Cancelled
The rate was planned to increase from April 2023, but this has now been scrapped. Limited Companies will now remain at 19% for their profits for the foreseeable future.