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New messaging on payslips required

18th Feb 2022
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The new Health and Social Care Levy introduced by the government aims to raise revenue for health and social care across the country. This levy is expected to raise £36 billion over three years to reform the NHS. From 6th April, the start of the 2022/23 tax year, the new 1.25% Health and Social Care Levy will come into effect. HMRC have requested the following message to be added to the payslips of those affected by the increase:  

‘1.25% uplift in NICs, funds NHS, health & social care’. 

The note should be added so that employees understand the increase and what it is helping to fund. 

How to add the message to payslips:  

Your 2022/23 payroll software should be updated to cater for this increase and should offer the ability to include this message on your employees’ payslips.  

If you are a BrightPay customer, this message will be automatically added to the payslips of affected employees. Users will have the ability to remove this message, if they wish. If you are not a customer of BrightPay, depending on the software you use, this message may need to be added manually to payslips by the payroll processor. 

From the 2023/24 tax year, when the levy becomes a separate tax, it will need to be shown on payslips as a new item. Your payroll software should be updated for the 2023/24 tax year to cater for this.  

Who is impacted by the levy?  

Initially, this 1.25% levy will be raised via a temporary increase to the National Insurance Contributions (NICs). This will impact Class 1 (employee and employer), Class 1A, Class 1B, and Class 4 (self-employed).  

In April 2023, the NI will revert to its current rates and the health and social care levy will be separated out on its own, as a new tax. All existing NI contribution reliefs will apply to this separate tax.  

If you are above the State Pension age, you will not need to pay the 1.25% levy in 22/23 tax year. However, from the 6th April 2023, if you are above State Pension age and are earning more than the primary threshold, you will be required to pay the levy.  

See the gov.uk website for more guidance on the Health and Social Care Levy

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