National Insurance Rates Set for Reduction in November 2022

As the cost-of-living crisis continues to rock the United Kingdom and costs continue to rise, the
recent news from the UK Government in which Chancellor Kwasi Kwarteng confirmed that the
increase to employee National Insurance contributions that came into effect earlier this year will
now be reversed as of 6 th November 2022.

The previous rise in rates, which took the NI contributions figure of 12% up to 13.25% was
introduced to cover the cost of the Health and Social care levy.

Chancellor Kwarteng said: “Taxing our way to prosperity has never worked. To raise living standards
for all, we need to be unapologetic about growing our economy.

“Cutting tax is crucial to this. Whether businesses reinvest freed-up cash in new machinery, lower
prices on shop floors or increased staff wages, the reversal of the levy will help them grow, whilst
also allowing the British public to keep more of what they earn.”

Employer National Insurance is also set to fall back to its previous level, effective from 6th November
2022. The Class 1 employer NIC will also be reduced by 1.25% to 13.8%. In the case of NICs rates
which apply annually, there will be transitional arrangements to reduce the current rates.

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