Dividend tax increase announced

The 1,25% increase in NIC contributions from April 2022 will be mirrored by a similar increase in the tax charge on dividends. From April 2022, the dividend tax increases will apply as follows:

Basic rate taxpayers will see an increase from the present 7.5% to 8.75%.
Higher rate taxpayers will see an increase from 32.5% to 33.75%.
Additional rate taxpayers will see an increase from 38.1% to 39.35%.

This change will apply UK-wide. It will be scored at the Budget and legislated for in the

National Insurance increase to fund NHS and social care

The Prime Minister announced increases in National Insurance Contributions (NIC) of 1.25% from April 2022, to contribute to increases in the NHS and social care budgets.

The increases will apply to:

Class 1 contributions (paid by employees). This is the NIC that is deducted from your earnings by your employer.
Class 4 (paid by self-employed). These contributions are added to your annual Self-Assessment statement.
Secondary Class 1 (paid by employers). Employer’s NIC contributions are paid