THE main rate of national insurance has been cut by two percentage points, from 12% to 10%, as of today (Saturday, January 6).
Chancellor Jeremy Hunt said the pre-election cut, which was announced as part of the Autumn Statement, means families with two earners are nearly £1000 better off.
The Government has said this reduction is set to save the average salaried worker on £35,400 around £450 in 2024.
It added: "Millions of people working different jobs across hundreds of industries will now be better off.
"An average full-time nurse will save £520, a typical junior doctor £750 and an average teacher £630."
Hunt, added: “With inflation halved, we’ve turned a corner and are cutting taxes – starting with today’s record cut to National Insurance worth nearly £1000 for a household.
“From nurses and brickies, to cleaners and butchers, 27 million hard-working Brits will have a little more cash in their pockets.”
How much National Insurance do I pay?
The amount of National Insurance you pay "depends on your employment status and how much you earn," says the Gov.uk website.
Most people's National Insurance rates from January 6, 2024 will be:
- 10% - down from 12% - if you are paid £242 to £967 a week (£1048 to £4189 a month)
- 2% - unchanged - if you are paid over £967 a week (£4189 a month)
National Insurance payments differ for those that are self employed.
Today we cut National Insurance by 2%. pic.twitter.com/JYzwZrzfRU
— UK Prime Minister (@10DowningStreet) January 6, 2024
How to pay
The Gov.uk website explains: "You pay National Insurance with your tax. Your employer will take it from your wages before you get paid.
"Your payslip will show your contributions."
National Insurance changes calculator
The HM Revenues and Customs (HMRC) has launched an online tool to give people an estimate on how much the change in the National Insurance rate will affect them.
The National Insurance changes calculator can be found HERE.
What does National Insurance pay for?
National Insurance contributions are, in some instances, put towards benefits and pensions, says the Gov.uk website, including:
-
State Pensions
-
Jobseeker’s Allowance
-
Maternity Allowance
-
Bereavement Support Payment
To qualify for certain benefits and the State Pension, you need to pay National Insurance.
Today is a big day. We’re cutting taxes for hard working people, coming into effect today. It’ll be worth almost £450 for the average worker. Find out more here:https://t.co/7QKzFrpo4B pic.twitter.com/6jxWVCX4kt
— Jeremy Hunt (@Jeremy_Hunt) January 6, 2024
Who pays National Insurance?
It is mandatory to pay National Insurance, according to Gov.uk, if you’re 16 or over and are either:
- An employee earning more than £242 per week from one job
- Self-employed and making a profit of more than £12,570 a year
For more information or to work out how much National Insurance you pay, visit the Gov.uk website.
