National Insurance Contributions are up £5bn on same time last year!

National Insurance Contributions are up £5bn on same time last year!

The overall National Insurance Contributions (NIC’s) take has increased by £11.76bn between April and June 2025, soaring to £209.6bn in just three months, with almost £5bn of this increase coming directly from employers’ NICs.

Income tax, capital gains tax and NICs have accounted for £120.5bn of the total tax take so far this year, which is £9.4bn higher than last year. From April this year employers’ NICs rose to 15% from 13.8% while the threshold was also reduced to £5,000 from £9,100 on the same day which is heavily impacting the amount paid by businesses.

Between May and June 2024 £17.5bn was paid in employers NICs at the lower rate of 13.8%. In the same period of 2025 businesses have paid out £21.6bn, with June alone falling just shy of £11bn.

However, as the hospitality and retail sector accounts for 45% of the total number of jobs lost since April, it seems working people are the very ones impacted by these changes most, as making it more expensive to employ people has forced businesses to make cuts to employees on minimum wage.

Not only is employers’ NICs on the rise, but corporation tax reached a high of £13.02bn in June, another rise that could impact the job market in the long run.

Higher taxes on businesses reduce the incentive for overseas companies to set up shop here. With job creation from foreign investment already falling, the link between rising tax rates and slowing inward investment is becoming harder to ignore.

Some tax changes have not had the intended outcome though, as the amount paid in capital gains tax (CGT) has been consistently dropping over the past few years. The 2022-23 tax year saw £16.9bn paid in CGT, which then fell to £14.4bn in 2023-24, and then again dropped to just over £13bn.