Page 28 - Budget Newsletter 2021

PENSIONS

2021/22 2022/23
Lifetime allowance* £1,073,100 £1,073,100
Lifetime allowance charge:
Excess drawn as cash 55% of excess
Excess drawn as income 25% of excess
Annual allowance £40,000 £40,000
Annual allowance taper:¶
Threshold income limit £200,000 £200,000
Adjusted income limit £240,000 £240,000
Minimum annual allowance £4,000 £4,000
Money purchase annual allowance £4,000 £4,000
Annual allowance charge 20%-45% of excess
Max. relievable personal contribution 100% relevant UK earnings or £3,600 gross if greater

* May be increased under 2006, 2012, 2014 or 2016 transitional protection provisions.
¶ 50% taper down to the minimum allowance based on excess over adjusted income limit if threshold income limit is
also exceeded.

NATIONAL INSURANCE CONTRIBUTIONS

CLASS 1 EMPLOYEE
2021/22 2022/23
Employee Employer Employee Employer+
Main NIC rate 12% 13.8% 13.25% 15.05%

No NICs on first:
Under 21* £184 pw £967 pw £190 pw £967 pw

21+ & over £184 pw £170 pw £190 pw £175 pw
Main NIC charged up to £967 pw No limit £967 pw No limit

Additional NIC rate 2% N/A 3.25% N/A
on earnings over £967 pw £967 pw

* Under 25 for apprentices.
+ No employer NICs for veterans in first 12 months of civilian employment.
No employer NICs on the first £481 per week of earnings for employees in Freeports (Great Britain only) from 6 April
2022 for the first 36 months of employment.

EMPLOYMENT ALLOWANCE
2021/22 2022/23

Per business* £4,000 £4,000

* Not available if a director is the sole employee or the previous tax year’s secondary NICs were £100,000 or more

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