An increase to the NI threshold has been confirmed ahead of the budget on 11 March. How will this affect your clients?
What’s changing?
From 6 April 2020 taxpayers will enjoy an NI threshold of £9,500 per year. During the next tax year, employees will save £104 as a result of these changes, and the self-employed will save around £78.
All the other NI thresholds will increase in line with inflation, except for the upper threshold which will remain frozen at £50,000.
Will employers also save NI?
The primary and secondary thresholds have been aligned in recent years, but this increase only applies to the threshold for primary Class 1 NI. Employers will start to pay NI on their employee earnings over £8,788 per annum (£169 per week).