United Kingdom

The U.K. government recently passed legislation introducing a health and social care levy to the National Insurance Contributions (NIC), increasing employer, employee and self-employed contributions by 1.25% of earnings. 

The NIC increase will apply only for the tax year 2022-23, beginning on 6 April 2022, through 5 April 2023. Beginning April 2023, the NIC will return to 2021-22 tax year rates and the 1.25% levy will become a separate tax on earned income.

Key details

For tax year 2022-23, the 1.25% health and social care levy will apply to NIC for:

  • Employees charged on their earnings (Class 1)
  • Employers charged on their employees’ earnings (Class 1A and 1B)
  • The self-employed charged on their earning profits (Class 4)

In 2023, a separate health and social care levy tax on the earnings of employees, employers and the self-employed will replace the temporary increase of the NIC rates.

Additional resources

Health and Social Care Levy Act 2021

National Insurance rates and categories