National Insurance Calculator: Find out your take-home pay after a new tax cut

MILLIONS of workers are lining up for a £450 pay rise after the Government announced another cut to National Insurance (NI).

Chancellor Jeremy Hunt confirmed this move today as part of the Spring Budget – and our calculator below tells you how much better off you’ll be.

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Mr Hunt unveiled a 2p cut on Class 1 NICs, which comes into effect on April 6.

It means that someone earning a salary of £35,000 a year will see their paycheck increase by £448.60 a year.

Those on a salary of £50,000 will see their wages rise by £750 per year.

Meanwhile, Class 4 NICs for the self-employed will fall by a further 2 cents, on top of the 1 cent cut already announced.

It comes after Mr Hunt and the Government today announced a raft of changes.

The chancellor announced that the minimum amount parents will have to pay back in child benefit will rise from £50,000 to £60,000, while the upper limit will rise to £80,000.

Meanwhile, households’ payments on Universal Credit and other benefits will rise by 6.7% from next month, government documents show.

In addition, a huge fund that provides support to low-income households and people on benefits has been extended for six months.

However, in a blow to households, cigarette packets will rise above £16 after the Chancellor announced an increase in tobacco duty.

Tobacco tax is a tax on the production or import of tobacco that is passed on to shoppers.

Meanwhile, the cost of vapes is also set to rise following an announcement from the Chancellor today.

How much will be cut in National Insurance?

Chancellor Jeremy Hunt confirmed that the Government is cutting the headline rate of employee NI, also known as Class 1 NICs, by 2p from 10% to 8%.

It comes after the government cut interest rates by two percentage points from 12% to 10% on January 6.

Meanwhile, the Government is also cutting 2p on the headline rate of self-employed NI, also known as Class 4 NICs, in addition to a 1p cut announced in the Autumn Statement.

Chancellor Jeremy Hunt said: “From April 6, national insurance for workers will be cut by a further 2p, from 10% to 8%.

‘And the national insurance for the self-employed will be reduced from 8% to 6%.

‘It means an extra £450 a year for the average worker or £350 for someone who is self-employed.

“Combined with the autumn cuts, this means that 27 million employees will receive an average tax cut of £900 per year and 2 million self-employed people will receive an average tax cut of £650.

“Changes that make our system simpler and fairer.”

Calculator to find out how much better off you are

The amount of NI you pay depends on your employment status and how much you earn.

Use our calculator to calculate how much you will save when the changes come into effect on April 6 tax experts at Blick Rothenberg.

It also gives you information about how much better off you are if you follow the Budget, depending on whether you have children, a car and whether you drink or smoke.

The more detailed information you provide, the more detailed answers you will receive.

Depending on whether you are an employee or self-employed, national insurance obviously works differently.

If you are employed, the company you work for will deduct tax and pay HMRC for you, with your contributions shown on your payslip.

If you are self-employed, you can pay your NICs online via the HMRC website via Self-Assessment.

Payments are generally due by January 31 and July 31 of each tax year.

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