Today, the Chancellor of the Exchequer has set out his autumn statement, which includes several significant announcements relating to employment and business:
- There will be an increase to the statutory minimum wage rates from April 2024:
a. The national living wage (NLW – the rate for workers aged 21 and above) is to increase by £1.02 to a new rate of £11.44 per hour.
b. The national minimum wage (NMW) for those between 18 and 20 will increase by £1.11 to £8.60 per hour and
c. The NMW for apprentices and those aged between 16 to 17 will increase by £1.12 to £6.40 per hour. - People who are receiving state benefits will be required to participate in a mandatory work placement if they have not found employment after 18 months. If they do not engage in the process to look for work then after six months, their benefits will cease.
- National Insurance paid by employees will be cut by 2% from 12% to 10%, with effect from 6 January 2024.
- Those on universal credit will receive a 6.7% increase in their monthly payments. As of June 2023, 2.3 million employees are receiving universal credit.
- The ‘Class 2’ National Insurance charge for those who are self employed will be abolished for those earning more than £12,570. This removes the weekly flat compulsory charge currently set at £3.45 per week. This will take effect from April 2024.
- The ‘Class 4’ charge of 9% on all earnings between £12,570 and £50,270 will be reduced from 9% to 8% and will take effect from April 2024.
- The way business rates are calculated will remain the same for a further year.
- The 75% discount for business rates up to £110,000 for those operating in retail, leisure and hospitality will be extended for another year.
- The small business multiplier, used when estimating business rates based on where the property is located, will be frozen at the current level of 49.9p for a further year until April 2025.
- The temporary tax break currently in place until December 2026 which allows businesses to deduct the full cost of investing in IT, equipment and machinery from their tax bill is to be made permanent.
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If you have questions surrounding the Autumn Statement and how it impacts your employees, we can support with that through our HR or Payroll services.
