News: April 2011

Saving national insurance contributions

With the nasty increase in NICs applying from 6 April 2011 it is worth looking at ways of reducing the effects.

This could involve, in the right circumstances, paying a bonus by 5 April 2011. In that way the extra 1% NICs payable by the employee form 6 April will be avoided – as indeed will be the separate extra 1% payable by the employer.

For the self-employed, facing an increase of 1% in the Class 4 NICs payable above the upper profits level, it may be possible to increase taxable profits in 2010/11 to reduce the effects of the increase. The price to pay for that, however, is bringing forward the date when income tax is due on any increased profits.

We will be pleased to advise you by reference to your specific circumstances.