6 March 2024
If you are covering the cut to national insurance, please see the following comment from Shaun Moore, tax and financial planning expert at Quilter:
"It had been heavily rumoured that the Tories wanted to at least cut National Insurance by 1% if not ideally 2% and the Chancellor by hook or by crook has made it happen despite worries that there was simply not enough fiscal headroom to make it work.
"The Tories have been under significant pressure to make this budget a giveaway bonanza to help shore up their support as they go into an election where they are certainly not favourites. Whether this move will ultimately help garner support is yet to be seen and may be a case of too little, too late. The reality is that many people are looking to the difficulties that public services are facing at the moment and wondering how such a tax cut like this will impact the NHS, schooling and other state support.
|
12% (pre Autumn statement) |
10% (current) |
Saving |
Additional 2% |
Total saving |
|
|
£30,000 |
£2,091.60 |
£1,743.00 |
£348.60 |
£348.60 |
£697.20 |
|
£34,963 |
£2,687.16 |
£2,239.30 |
£447.86 |
£447.86 |
£895.72 |
|
£40,000 |
£3,291.60 |
£2,743.00 |
£548.60 |
£548.60 |
£1,097.20 |
|
£50,000 |
£4,491.60 |
£3,743.00 |
£748.60 |
£748.60 |
£1,497.20 |
"National Insurance is a crucial element of funding for public services and while Hunt did make a commitment to provide a 1% real increase in funding and a commitment to work more efficiently, reducing NI contributions could make this hard to achieve. Balancing individual financial relief with the sustainability of public services will be key in ensuring this change benefits the broader society.
"It is important to remember though that this change gives nothing to pensioners who do not pay national insurance, so while an income tax cut was clearly deemed too expensive it might have had a broader impact on the nation as a whole."
For more information, please contact Alex Berry on + 44 (0)7741151931
