In September 2021, the government announced tax changes to raise additional funding for the NHS to cover Health & Social Care, which will take effect from April 2022.
This change introduces a brand new UK-wide tax modelled on the existing National Insurance Contributions (NICs) known as the Health & Social Care Levy.
However, the new levy will not apply straight away to allow HMRC and software developers time to update their systems. So, from April 2022, it is to be collected by applying a temporary increase of 1.25% on Employee & Employer NI Contributions.
The new standalone Health & Social care levy is due to be introduced in April 2023. As a result, we should see the rates for Employee & Employer NI Contributions dropping back to their normal levels in April 2023, which are currently 12% for Employees and 13.8% for Employers.
National Minimum Wage (NMW)
The NMW for those aged 21-22 will increase by 9.8% from £8.36 to £9.18 per hour.
The NMW for those aged 18-20 will increase by 4.1% from £6.56 to £6.83 per hour.
The NMW for those aged 16-17 will increase by 4.1% from £4.62 to £4.81 per hour.
The Apprentice Rate will increase by 11.9% from £4.30 to £4.81 per hour.