Draft Regulations laid before Parliament under section 176(1)(za), (zb) and (a) of the Social Security Contributions and Benefits Act 1992, section 172(11ZA), (11ZB) and (11A) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992, sections 141(3) and 190(1)(a) of the Social Security Administration Act 1992, section 166(10A) of the Social Security Administration (Northern Ireland) Act 1992, section 2(8) of the Social Security Act 1993 and article 4(8) of the Social Security (Northern Ireland) Order 1993 for approval by resolution of each House of Parliament.
2018 No. 0000
The Social Security (Contributions) (Rates, Limits and Thresholds Amendments and National Insurance Funds Payments) Regulations 2018
Made
Coming into force
These Regulations are made by the Treasury in exercise of the powers conferred by sections 5(1) and (4) to (6), 9A(7) and (8), 9B(4) and (5) and 175(3) of the Social Security Contributions and Benefits Act 19921 (“the Contributions Act”), sections 5(1) and (4) to (6), 9A(7) and (8), 9B(4) and (5) and 171(3) and (10) of the Social Security Contributions and Benefits (Northern Ireland) Act 19922 (“the Northern Ireland Contributions Act”), sections 141(4) and (5) and 142(2) and (3) of the Social Security Administration Act 19923 (“the Administration Act”), section 129 of the Social Security Administration (Northern Ireland) Act 19924 (“the Northern Ireland Administration Act”), section 2(2) and (3) of the Social Security Act 19935 (“the 1993 Act”) and article 4(3) and (4) of the Social Security (Northern Ireland) Order 19936 (“the 1993 Order”).
Regulations 3 to 5 of these Regulations are made as a result of the Treasury carrying out in the tax year 2017-18 a review of the general level of earnings in Great Britain in accordance with section 141(1) and (2) of the Administration Act7.
The Treasury have determined that, in relation to Great Britain, regulations 3 to 5 should be made under section 141 of the Administration Act, to amend Part 1 of the Contributions Act by altering the rate of, and small profits threshold for, Class 2 contributions, the amount of a Class 3 contribution and the lower and upper limits of profits to be taken into account for Class 4 contributions.
Regulations 3 to 5 of these Regulations make provision for Northern Ireland, which corresponds to that mentioned in relation to Great Britain in the preceding recital, in accordance with section 129 of the Northern Ireland Administration Act.
With a view to adjusting the level at which the National Insurance Fund stands for the time being, and having regard to estimated benefit expenditure for the financial year ending with 31st March 2019, the Treasury think it expedient that regulation 9 of these Regulations should be made under section 2(2) of the 1993 Act.
With a view to adjusting the level at which the Northern Ireland National Insurance Fund stands for the time being, and having regard to estimated benefit expenditure for the financial year ending with 31st March 2019, the Treasury think it expedient that regulation 10 of these Regulations should be made under article 4(3) of the 1993 Order.
A draft of these Regulations was laid before Parliament in accordance with the provisions of section 176(1)(za), (zb) and (a) of the Contributions Act8, section 172(11ZA), (11ZB) and (11A) of the Northern Ireland Contributions Act9, sections 141(3) and 190(1)(a) of the Administration Act10, section 166(10A) of the Northern Ireland Administration Act11, section 2(8) of the 1993 Act and article 4(8) of the 1993 Order12 and approved by a resolution of each House of Parliament.
PART 1General
Citation and commencement1
These Regulations may be cited as the Social Security (Contributions) (Rates, Limits and Thresholds Amendments and National Insurance Funds Payments) Regulations 2018 and come into force on 6th April 2018.
PART 2Rates, limits and thresholds for National Insurance contributions
Interpretation2
In this Part—
“the Act” means the Social Security Contributions and Benefits Act 1992; and
“the Northern Ireland Act” means the Social Security Contributions and Benefits (Northern Ireland) Act 1992.
Rate of and small profits threshold for Class 2 contributions3
a
in subsections (2) and (6) for “£2.85” substitute “£2.95”; and
b
in subsection (4) (small profits threshold) for “£6,025” substitute “£6,205”.
Amount of a Class 3 contribution4
Lower and upper limits of profits for Class 4 contributions5
In sections 15(3) and 18(1) and (1A) of the Act17 and the Northern Ireland Act18 (Class 4 contributions recoverable under the Income Tax Acts and under regulations)—
a
for “£8,164” (lower limit) in each place where it appears substitute “£8,424”; and
b
for “£45,000” (upper limit) in each place where it appears substitute “£46,350”.
Amendments to the Social Security (Contributions) Regulations 2001
6
The Social Security (Contributions) Regulations 200119 are amended as follows.
7
In regulation 10 (earnings limits and thresholds)—
a
in the introductory words, for “2016” substitute “2018”;
b
in paragraph (a) (lower earnings limit: primary Class 1 contributions) for “£113” substitute “£116”;
c
in paragraph (b) (upper earnings limit: primary Class 1 contributions) for “£866” substitute “£892”;
d
in paragraph (c) (primary threshold: primary Class 1 contributions) for “£157” substitute “£162”;
e
in paragraph (d) (secondary threshold: secondary Class 1 contributions) for “£157” substitute “£162”;
f
in paragraph (e) (upper secondary threshold: secondary Class 1 contributions in relation to the Under 21 group) for “£866” substitute “£892”; and
g
in paragraph (f) (upper secondary threshold: secondary Class 1 contributions in relation to relevant apprentices) for “£866” substitute “£892”.
8
In regulation 11 (prescribed equivalents)—
a
in paragraph (2A)—
i
in sub-paragraph (a) for “£3,750” substitute “£3,863”; and
ii
in sub-paragraph (b) for “£45,000” substitute “£46,350”;
b
in paragraph (3)—
i
in sub-paragraph (a) for “£680” substitute “£702”; and
ii
in sub-paragraph (b) for “£8,164” substitute “£8,424”;
c
in paragraph (3A)—
i
in sub-paragraph (a) for “£680” substitute “£702”; and
ii
in sub-paragraph (b) for “£8,164” substitute “£8,424”;
d
in paragraph (3B)—
i
in sub-paragraph (a) for “£3,750” substitute “£3,863”; and
ii
in sub-paragraph (b) for “£45,000” substitute “£46,350”; and
e
in paragraph (3C)—
i
in sub-paragraph (a) for “£3,750” substitute “£3,863”; and
ii
in sub-paragraph (b) for “£45,000” substitute “£46,350”.
PART 3National Insurance Funds
Prescribed percentage of estimated benefit expenditure – Great Britain9
Section 2(2) of the Social Security Act 1993 (payments into National Insurance Fund out of money provided by Parliament) has effect with respect to the tax year 2018-19 and the prescribed percentage of estimated benefit expenditure for the financial year ending with 31st March in that tax year shall be 5 per cent.
Prescribed percentage of estimated benefit expenditure – Northern Ireland10
Article 4(3) of the Social Security (Northern Ireland) Order 1993 (payments into Northern Ireland National Insurance Fund out of appropriated money) has effect with respect to the tax year 2018-19 and the prescribed percentage of estimated benefit expenditure for the financial year ending with 31st March in that tax year shall be 5 per cent.
(This note is not part of the Regulations)