National Insurance contribution rate increase written into legislation

11 March 2022

The Social Security (Contributions) (Rates, Limits and Thresholds Amendments and National Insurance Funds Payments) Regulations 2022 have been laid before Parliament, taking effect from 6 April 2022.

The increase in National Insurance contributions from April 2022 has now been announced and approved as anticipated. The legislation allows for the annual re-rating of National Insurance contribution rates for calculating class 1, class 2, class 3 and class 4 liabilities.

The CIPP recommends that payroll departments work hard to educate their workforce and inform them of the upcoming rates, as communication is key to managing such unprecedented changes. All class 1 and class 4 contributions will be subject to an increase of 1.25% in the contribution percentage rate. Below is a table comparing the current rates to the new ones.

Rate

Current rate

2022-23 rate

Main employee rate

12%

13.25%

Married women’s rate

5.85%

7.1%

Deferred rate

2%

3.25%

Rate on employee’s earnings above UEL

2%

3.25%

Main employer rate

13.8%

15.05%


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