NIC rates
See TM ¶5004, ¶5056, ¶5064, ¶5093, ¶9976
A minor change will be made to next year’s NIC thresholds but more significant increases will be encountered the year after that.
2010/11
The lower earnings limit, above which employees earn entitlement to benefits, will increase by £2 to £97 per week, effective from 6 April 2010. The earnings threshold, above which contributions become due, will remain unchanged at £110 per week.
2011/12
From 6 April 2011 the rates of Class 1, 1A, 1B and 4 NIC will all increase by 1% (a ½% increase was announced in last year’s PBR and a further ½% increase this year). This will take Class 1 employer’s NIC to 13.8%, and Class 1 employee’s NIC to 12% for earnings up to the upper earnings limit and 2% above it. The self-employed will suffer Class 4 NIC at 9% up to the upper profits limit and 2% above it.
The earnings threshold will be increased by £570 to compensate the lowest earners for the rate increases noted above. This is in addition to the increase announced at PBR last year to “broadly align” the threshold with the income tax personal allowance.
