Class 4 NICs increase for self-employed: ISM statement (UPDATED)
As part of the Spring budget announced yesterday, the Chancellor of the Exchequer has announced that from April 2018, when the Class 2 NIC is abolished, the main rate of Class 4 NICs for the self-employed will increase by 1% to 10%, with a further 1% increase in April 2019.
The abolition of Class 2 NICs for self-employed people, announced in 2016, is due to take effect in 2018, and since Class 2 contributions are payable at a flat rate, while Class 4 is chargeable as a proportion of profits, all self-employed people earning less than £16,250 will still see a reduction in their total NICs bill.
Deborah Annetts, Chief Executive of the Incorporated Society of Musicians, said:
'We are concerned by the possible impact of these proposals on the music profession, which is predominantly made up of self-employed musicians.
At a time when creativity is so important for securing growth in the UK economy, we would ask the Government to make sure they do not make tax changes that have the unintended consequence of undermining growth in the creative sector.'