Health and Social Care Levy

A new ‘Health and Social Care Levy’ to fund investment in the NHS and social care is to be introduced from April 2022 .

From April 2022, National Insurance contributions for working age employees, self-employed people and employers will increase by 1.25% and will be added to the existing NHS allocation. The NIC rate for most employees was 12% in 2021-22, and this will rise to 13.25% in 2022-23. The rate at which employers pay NIC will also rise from 13.8% in 2021-22 to 15.05% in 2022-23.

To ensure taxpayers understand that their increased contribution is helping fund public services, the Government are asking all employers to include a generic message for their employees on all payslips between 6 April 2022 and 5 April 2023 explaining what these funds will be used for. The message will read ‘1.25% uplift in NICs funds NHS, health & social care’.

Moneysoft Payroll Manager has been updated to include the changes that will affect payroll from April 2022. This includes displaying the generic message on each payslip (e.g. below)

payslip message

Employers can choose not to display this message on payslips if they wish by clicking on the ‘Options’ button on the payslip toolbar  and unticking the box marked ‘Show Health and Social Care message’

 

From April 2023, the Health and Social Care Levy will be formally separated from National Insurance contributions and will also apply to the earnings of individuals working above State Pension age. National Insurance contribution rates will return to normal levels, and Health and Social Care Levy deductions will be shown as a completely separate item on the employee payslip. From April 2023, receipts from the Levy will go directly for spending on health and social care across all parts of the UK.

FAQ

Will employees that are above State Pension Age need to pay the Health and Social Care levy (HSCL)? – Employees that have reached State Pension Age will not be affected by the temporary increase to National Insurance contributions for the 2022 to 2023 tax year but will be liable to pay the levy from April 2023. See Prepare for the Health and Social Care Levy – GOV.UK (www.gov.uk) for more details.

Prepare for the Health and Social Care Levy – GOV.UK (www.gov.uk)

Health and Social Care Levy – GOV.UK (www.gov.uk)

 

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