Headlines
- National Insurance rate for employees reduced from 12% to 10% from 6 January 2024.
- Class 2 NIC abolished and Class 4 reduced from 9% to 8% from April 2024.
- National living wage to increase from £10.42 to £11.44 per hour from 1 April 2024.
National insurance
Although the current thresholds for income tax and national insurance remain frozen until 2028, the main rate of national insurance will fall from 12% to 10% from 6 January 2024.
In addition, Class 2 National Insurance, paid by self-employed individuals, will be abolished from April 2024. Class 4 National Insurance, which is paid on self-employed profits between £12,570 and £50,270 will be cut from 9% to 8% from April 2024.
Minimum wage uplifts
Following last year’s 9.7% uplift in the National Living Wage announced in the 2022 Autumn Statement, a further increase of 9.8% has been announced. From 1 April 2023 the new rate will be £11.44, up from £10.42 per hour. For the first time, the NLW applies to workers aged 21 and 22 with the previous lower rate brought in line and scrapped.
Alongside the NLW increase, the National Minimum Wage rates and Apprentice rate have increased by 14.8% and 21.2% respectively.