We just wanted to draw your attention to some of the changes that you will notice in your employees’ payslips from April 2025.
Employer’s National Insurance
From April 2025, the employer’s rate of National Insurance will rise from 13.8% to 15%.
In addition to this, the threshold at which an employer needs to pay National Insurance has been reduced. This is known as the secondary threshold, and has been reduced from £9100 to £5000 per year.
These changes will cause increases in the amount of National Insurance that employers need to pay. However, if eligible, employers can claim back some of the National Insurance they are due to pay, by claiming the employment allowance.
Employment Allowance will increase from £5,000 to £10,500, however you can only claim the allowance against the Employer’s National Insurance that is due, so this may be less than the maximum of £10,500.
For our clients, we can confirm that if you are eligible, and we will automatically claim this for you through the payroll, reducing the National Insurance due to be paid over to HMRC.
National Minimum Wage
As part of the budget announcement, the government have confirmed the national minimum wage rates for the upcoming 2025/26 tax year. These rates are as follows:
• Age 21+ - £12.21 an hour
• Ages 18-20 - £10.00 an hour
• Aged under 18 - £7.55
• Apprentice Rate - £7.55
You are required by law to pay at least the national minimum wage, and therefore we will automatically increase the hourly rate of staff to the national minimum wage in April if required.
Employee’s Tax
Whilst the personal allowance rates for 2025/2026 tax year have not changed, some of your employees may receive a new tax code from April 2025.
Tax code changes can occur throughout the tax year, as HMRC send through notifications, so it is good practice to always check the payroll information each month and make sure you are paying your employees the correct NET pay every month.
We advise against setting up a standing order to make salary payments, as small variations are likely even when a tax code does not change.
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