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National Insurance Contributions (Reduction In Rates) Act 2023

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Explanatory Notes

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Text created by the government department responsible for the subject matter of the Act to explain what the Act sets out to achieve and to make the Act accessible to readers who are not legally qualified. Explanatory Notes were introduced in 1999 and accompany all Public Acts except Appropriation, Consolidated Fund, Finance and Consolidation Acts.
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This Act introduces a cut in the rate of primary (employee) Class 1 National Insurance contributions (NICs) from 12% to 10% and a cut in the rate of self-employed Class 4 NICs from 9% to 8% with related consequential changes. The Act also includes provisions to remove the liability of self-employed persons to pay Class 2 NICs for those with profits above £12,570 per annum, whilst maintaining access to contributory benefits. The Class 1 NICs rate cut takes effect from 6 January 2024. The Class 4 NICs rate cut and provisions relating to Class 2 NICs will take effect from 6 April 2024.