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NIC increases from 6 April 2009
26/03/2009, by Sarah Laing, Tax News - PAYE and Payroll Taxes, National Insurance, NICs
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The Social Security (Contributions) (Re-rating) Order 2009 (SI 2009/593) comes into force on 6 April 2009.

This Order increases the rates of Class 2 and Class 3 national insurance contributions (NICs) from 6 April 2009. The weekly rate for Class 2 NIC increases from £2.30 to £2.40, and Class 3 contributions will increase from £8.10 to £12.05 per week.

The Order also increases the lower earnings exemption threshold for Class 2 NICs from £4,825 to £5,075 from 6 April 2009. This is the limit below which no Class 2 contributions are payable.

In addition, the Order also increases, from £5,435 to £5,715 and from £40,040 to £43,875 respectively, the lower and upper profit limits between which Class 4 contributions are payable at the main Class 4 percentage rate (8 per cent for 2008-09).

The Social Security (Contributions) (Amendment No. 2) Regulations 2009 (SI 2009/591) also come into force on 6 April 2009.

These regulations specify the lower and upper earnings limits for primary Class 1 contributions, and the primary and secondary thresholds for Class 1 NICs for the tax year beginning 6 April 2009.

From 6 April 2009:

  • the lower earnings limit will increase from £90 per week to £95 per week;
  • the upper earnings limit will increase from £770 per week to £844 per week; and
  • the primary and secondary thresholds for Class 1 NICs will increase from £105 to £110 per week.

About The Author

Sarah Laing
Editor, TaxationWeb News

Sarah is a Chartered Tax Adviser. She has been writing professionally since joining CCH Editions in 1998 as a Senior Technical Editor, contributing to a range of highly regarded publications including the British Tax Reporter, Taxes - The Weekly Tax News, the Red & Green legislation volumes, Hardman's, International Tax Agreements and many others. She became Publishing Manager for the tax and accounting portfolio in 2001 and later went on to help run CCH Seminars (including ABG Courses and Conferences).

Sarah originally worked for the Inland Revenue in Newbury and Swindon Tax Offices, before moving out into practice in 1991. She has worked for both small and Big 5 firms. She now works as a freelance author providing technical writing services for the tax and accountancy profession.

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