The health and social care levy comes in to practice in April 2022 which will affect employees and employers. The levy will raise extra funding for the NHS and social care and the contributions will be an additional 1.25%.
With the health and social care levy it will be important to be aware of the following:
- For the first year from April 2022 the 1.25% increase for Class 1, Class 1A, Class 1B, and Class 4 (self-employed) will be included in your national insurance contribution.
- In 2023 the 1.25% levy will be replaced with a standalone contribution and the national insurance contribution rates will drop to the usual levels.
- Employers and employees will be subject to the levy.
- The additional cost to employment will be 2.5%.
- Individuals who only pay Class 2 and Class 3 National Insurance contributions are unaffected.
- Individuals above the state pension age will not be affected by the temporary National Insurance increase but will be liable to pay the levy from 2023.
The new health and social care levy will be subject to the same reliefs, thresholds, and requirements of the qualifying National Insurance contributions (Class 1, Class 1A, Class 1B, or Class 4) In respect of which the levy is payable.
If you’d like to learn more please contact me on info@saleeaccountancy.com or at https://saleeaccountancy.com
Sarah Lee
MAAT CIMADipMA
Please note, that all figures are correct at the time of writing
Thank you.