Class 4 National Insurance Contributions Increase Reversed

Reversal of Class 4 NIC Rate Increase

The government has reversed its earlier proposal to increase the rate of Class 4 National Insurance Contributions (NICs). Initially, the plan was to raise the rate from 9% to 10% starting 6 April 2018. And then to 11% from April 2019. However, these increases have been cancelled. 

Abolition of Class 2 NICs

The government has confirmed that Class 2 NICs will be abolished from 6 April 2024. This change means that self-employed individuals with profits above £12,570 will no longer be required to pay the flat-rate weekly Class 2 NICs. Despite this abolition, these individuals will continue to have access to contributory benefits. This includes the State Pension.

For self-employed individuals with profits between the Small Profits Threshold (£6,725) and the Lower Profits Limit (£12,570), there will be no change. They will continue to receive National Insurance credits without having to pay Class 2 NICs, maintaining their entitlement to contributory benefits.

Future Financial Plans

The government has indicated that plans to address the resulting gap in finances will be announced in the upcoming Autumn Budget. Stakeholders are advised to stay informed about these developments to understand how potential changes may impact their financial planning.

How We Can Help

Navigating changes in National Insurance Contributions can be complex. At Lewis Brownlee, we provide expert advice to help you understand how these changes may affect your financial situation. As leaders in the field, we have a finger to the pulse of every change. So, you can be assured that all eventualities are covered with us. 

We also offer a free introductory meeting. Consequently, you can find out exactly how we can help before you commit!

For personalised assistance, contact us today. Together, let’s ensure your Class 4 National Insurance Contributions queries are answered!

By staying informed about the latest developments in National Insurance Contributions, individuals can make better financial decisions and ensure compliance with current regulations.