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On 7 September 2021 the government announced a new 1.25% Health and Social Care Levy that will be used to fund investment in the NHS and social care.

Despite speculation in the media as to whether this will be delayed or not, the current expectation is that the Levy is going to be introduced from April 2022 when National Insurance contributions for working age employees, self-employed people and employers will increase by 1.25% points and be added to the existing NHS allocation.

From April 2023, the Levy will be formally separated from National Insurance contributions (NICs) and will also apply to the earnings of individuals working above State Pension age and National Insurance contribution rates will return to 2021 to 2022 levels. From April 2023, receipts from the Levy will go directly for spending on health and social care across all parts of the UK.

To ensure taxpayers know that their increased contribution is helping fund public services, HMRC are asking employers to include a message for their employees on all payslips between 6 April 2022 and 5 April 2023 explaining what these funds will be used for.

The message should read ‘1.25% uplift in NICs funds NHS, health & social care’.

HMRC have contacted payroll software providers to request that they include this messaging in their software and wider support models, but they do realise that some employers will need to make the change directly.