Have your say on the National Insurance Contributions Bill

Aims of the Bill

The Bill would introduce four measures:

• a new zero-rate of secondary Class 1 National Insurance contributions (NICs) for employers taking on employees in a freeport. Employers would be able to claim relief on the earnings of eligible employees up to £25,000 per year, for three years. The zero rate would apply from April 2022.
• a new zero-rate of secondary Class 1 NICs for employers who hire an armed forces veteran during their first year of civilian employment after leaving the armed forces. Employers would be able to claim relief on the earnings of an eligible employee up to the NICs Upper Secondary Threshold. Employers would be able to claim the relief from April 2022 and transitional arrangements will allow retrospective claims for the 2021/22 tax year.
• an exemption for Covid-19 Test and Trace Support Payments for Class 4 and Class 2 NICs, which are paid by the self-employed. An exemption already applies for Class 1 and Class 1A NICs – paid by employees and employers – and this measure would be formally retrospective for the 2020/21 tax year.
• a provision to allow changes to the Disclosure of Tax Avoidance Schemes (DOTAS) regime as it applies to NICs avoidance schemes. These changes would mirror amendments to the DOTAS regime as it applies to other tax avoidance schemes, made by provisions included in the Finance Bill 2021.

These measures would extend and apply to the whole of the UK.

Clauses 1 to 11 of the Bill cover these four measures. The remaining clauses (12-14) set out how regulations under this legislation are to be introduced, the definition of various terms used, and the title of this legislation.

Statutory provisions regarding NICs are not included in the annual Finance Bill. Over the last few years changes to NICs have been made by the introduction of relatively short bills similar to this one (for example, the National Insurance Contributions Act 2014, and the National Insurance Contributions Act 2015).

Follow the progress of the National Insurance Contributions Bill

The National Insurance Contributions Bill 2021-22 was introduced on 12 May 2021. Second Reading took place on 14 June 2021. The Bill, with its explanatory notes, is published on the Bill’s page on Parliament.uk, which also provides details of its parliamentary progress to date. Further information on the Bill is collated on Gov.uk.

• Bills before Parliament: National Insurance Contributions Bill 2021–22
• Read Explanatory Notes: National Insurance Contributions Bill 2021–22
• House of Commons Library Briefing Paper

There will be no oral evidence sessions held for this Bill.

Guidance on submitting written evidence

Deadline for written evidence submissions

Written evidence can now be sent in to the Public Bill Committee. The Public Bill Committee will complete all its deliberations on the Bill on Tuesday 22 June. You are strongly advised to submit your written evidence as soon as possible. The sooner you send in your submission, the more time the Committee will have to take it into consideration and possibly reflect it in an amendment. The order in which amendments are taken in Committee will be available in due course under Selection of Amendments on the Bill documents pages. Once the Committee has dealt with an amendment it will not revisit it.

Your submission should be emailed to scrutiny@parliament.uk

Further guidance on submitting written evidence can be found here.

Image: Parliamentary Copyright