Expert Insights

Latest news stories and opinions about the Dental, GP and Care Industries. For your ease of use, we have established categories under which you can source the relevant articles and news items.

21st February 2022

National Insurance Rates are rising from April 2022

Brian Boggie, MAAT, of 2B Accounting and Business Solution explains what the new rates mean for you.

You can download the factsheet below

Download Now

From 6 April 2022 to 5 April 2023 National Insurance payments will rise by 1.25%. This will be spent on the NHS and social care in the UK.

How much National Insurance will you pay?

The amount of National Insurance you pay depends on your employment status and how much you earn.

The increase will apply to:

  • Class 1 (paid by employees)
  • Class 4 (paid by self-employed)
  • secondary Class 1, 1A and 1B (paid by employers)

In short, anyone who is currently in employment or self-employed and earning more than £9568 per year will be affected by the increase.

If you are a business owner and have employees, there will be an increase of 1.5% in Employer Contributions.

How much more will I pay?

Current tax year 2021- 2022 compared to 2022-2023

So how will the new tax affect me?

EarningsTax Year 21/22Tax Year 22/23
Up to £9568 per year0%0%
£9569 to £50270 per year12%13.25%
£50271 and above2%3.25%

I earn £20,000 per year.

 Tax Year 21/22NI PaidTax Year 22/23NI paidIncrease in NI Paid
Up to £9568 per year0%£0.000%£0.00
£9569 to £50270 per year12%£1251.8413.25%£1382.24
£50271 and above2%£0.003.25%£0.00
Total NI Paid£1251.84£1382.24£130.40

I earn £30,000 per year

 Tax Year 21/22NI PaidTax Year 22/23NI PaidIncrease in NI Paid
Up to £9568 per year0% £0.000% £0.00
£9569 to £50270 per year12% £2451.84 13.25% £2707.24
£50271 and above2%£0.00 3.25% £0.00
Total NI Paid£2451.84£2707.24£255.40

I earn £40,000 per year

 Tax Year 21/22NI paidTax Year 22/23NI paidIncrease in NI Paid
Up to £9568 per year0%£0.000% £0.00
£9569 to £50270 per year12%£3651.8413.25%£4032.24
£50271 and above2%£0.003.25%£0.00
Total NI Paid£3651.84£4032.24£380.40

I earn £50,000 per year

 Tax Year 21/22NI PaidTax Year 22/23NI Paidcrease in NI Paid
I earn £50,000 per year0% £0.00 0%£0.00
£9569 to £50270 per year12% £4851.8413.25%£5357.24
£50271 and above2%£0.00 3.25% £0.00
Total NI Paid£4851.84 £5357.24£505.40

Business owners

If you are a business owner, you can elect to pay yourself part salary and part dividend from profits. Dividends do not attract National Insurance and are also taxed at a lesser rate of 7.5%.

For example, I am a business owner and I pay myself £50,000

 All salary Salary/Dividend
Gross Pay via PAYE£50000 £15000
Tax allowance£12570 £12570
Taxable Pay£34730£2430
Tax£7486£486
NI £4852£652
Dividend£35000
Dividend Tax Allowance£2000
Taxable Dividend£33000
Tax on Dividend£2475
Net Pay received£37662 £46387

 

*All information is correct at the time of publishing. Use of this material is subject to your acceptance of our terms and conditions.

Join over 130,000 users already using the QCS Management System!
Start Free Trial Buy Now
Back to Top

Register here for your FREE TRIAL

  • Try our unique Management System, or any of our individual packs
  • PLUS! Gain FREE trial access to our Mock Inspection Toolkit
  • Over 2,300+ pages of easy to use guidance and 300+ policies & procedures

Simply fill out the form below and get full access for 24 hours to a QCS Management System of your choice.