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U-TURN ON SELF-EMPLOYED NICs – FOR NOW
In his first Budget on 8th March, the new Chancellor Phillip Hammond announced that he would level the playing field between employees and the self-employed by increasing Class 4 National Insurance Contributions (NICs) from 9% to 10% from 6 April 2018 and then to 11% from 6 April 2019. His justification is that the self-employed are now entitled to more generous State Benefits than in the past, and thus NIC rate should be increased towards the 12% Class 1 NIC employee rate.
However, this was contrary to the Conservative Party manifesto pledge not to raise national insurance contributions during the life of the Parliament and the Government have bowed to political pressure and decided not to proceed with this proposal. Look out for a possible increase after the next election, which is now June 8th!
Flat rate Class 2 NIC contributions, now £2.85 a week, cease on 5 April 2018.
We hope you enjoyed reading this piece about SELF-EMPLOYED NICs and find it useful. Please contact us if you would like to discuss any matters further.
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