November 23, 2022

How will the new national insurance threshold affect my payslip?

It comes after the National Insurance price hike, announced by Boris Johnson last year, took effect in April.

The Prime Minister announced a 1.25 percentage point increase in national insurance last September to deal with the funding crisis in the health and social protection system.

From Wednesday, July 6, your payslips will start to look a little different, but how much more will you receive?

How much extra salary will I receive after the National Insurance change?

Almost 30 million workers will benefit, with a typical employee saving more than £330 in the year from July, according to the UK government.

(PENNSYLVANIA)

According to the Press Association, someone on a salary of £40,000 would pay £304.32 a month on National Insurance, before the 1.25% hike.

Currently, they will pay £332.58 per month.

Following the threshold change on July 6, you would pay £302.87 per month.

According to Hargreaves Lansdown, someone earning £20,000 would have had a monthly NI bill of around £104 before April, which then rose to £112 and will fall to around £82 after the July changes.

Someone with £30,000 would have paid around £204 a month before April, then rising to £222 and they will now see that drop to around £192.

Someone with £50,000 will pay around £413 a month from July, up from around £404 before April, and someone earning £60,000 will pay around £443 from July, up from £423 before April, according to Hargreaves Lansdown.

The government has said that seven out of 10 workers (70%) who pay National Insurance (NIC) contributions will pay less, even after taking into account the health and social care tax.

However, with daily prices such as food and fuel rising sharply, some households may not feel better in practice, even with more money in their wage envelope.

What cost of living assistance is available?

Widespread and targeted support was recently announced to help people in difficulty until 2022 when a difficult winter is expected.

More than eight million households will start to see cost of living payments hit their bank accounts on July 14, when the first installment of £326 starts flowing to low-income households on benefits.

The second part of the £650 one-off payment will follow this autumn.

Retired households will receive £300 to help cover winter costs, while those on disability benefits will receive an additional £150.

Households will typically also have £400 in savings on their energy bills.