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Change to Class 4 NIC rate reversed

Newsletter issue - April 2017.

The Government has confirmed that the proposed increase in the rate of Class 4 National Insurance Contributions, paid by the self-employed on profits from a business, will not now take effect from April 2018. The Chancellor of the Exchequer, Philip Hammond, had announced that the rate would rise from 9% to 10% from 6 April 2018, and again to 11% from April 2019.

In a letter to MPs informing them of the decision, Mr Hammond said 'however difficult the fiscal challenges we face, the tax lock and spending ring-fence commitments we have made for this Parliament should be honoured in full'. He went on to say that the cost of this change will be funded by measures to be announced in the Autumn Budget Statement, which indicates that future changes can be expected.

The abolition of Class 2 NICs from April 2018 will go ahead as planned.

 

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