Self-employed national insurance contributions rise in Budget 2017
8th March 2017 | News
Self-employed professionals face a rise in their National Insurance contributions (NICs), following Philip Hammond's first Budget as Chancellor of the Exchequer today, 8th March.
The self-employed currently pay 9% in NICs on earnings over £8,060, compared with 12% for employees.
He explained that a salary of £32,000 a year incurs total £6,170 in NICs, while a self-employed individual on the same income pays just £2,300 in NICs.
“Employed and self-employed alike use our public services in the same way but they are not paying for them in the same way,” Hammond told the House of Commons.
“People should have choices about how they work but those choices should not be driven primarily by differences in tax treatment.”
Class 2 NICs will be abolished and Class 4 NICs will increase by 1% in April 2018 and by 1% in April 2019. The increase will cost every self-employed person on average 60p more a week in NICs.
The change - together with other reforms unveiled by Hammond’s predecessor, George Osborne, and coming in at the same time - will raise a net £145million a year "for our public services by 2021/22".
You can read more about what was announced at the Spring Budget 2017 by visiting our dedicated page here.