Introduction to Income Tax and NICs National Insurance contributions
4.7.3 Secondary Threshold (ST)
The Secondary Threshold (ST) falls between the Lower Earnings Limit (LEL) and the Upper Earnings Limit. The level is set each year as an annual amount and the weekly and monthly equivalents are proportions of the annual amount.
When earnings in any pay period exceed the appropriate ST, employer (secondary) NICs are calculated on the excess.
Note that currently NICs are not actually payable on that part of the earnings falling between the LEL and the ST because the percentage rate applicable to the earnings is 0%.
4.7.4 Upper Secondary Threshold (UST)
The Upper Secondary Threshold (UST), which was introduced in April 2015 at 0%, is prescribed each year.
Employers pay a specific rate of NICs on earnings between the Secondary Threshold (ST) and the UST for employees aged under 21 years old. The specific rate for 2023-24 is 0%.
4.7.5 Apprentice Upper Secondary Threshold (AUST)
The Apprentice Upper Secondary Threshold (AUST), which was introduced in April 2016 at 0%, is prescribed each year.
Employers pay a specific rate of NICs on earnings between the Secondary Threshold (ST) and the AUST for employees aged under 25 years old who are on an approved apprenticeship. The specific rate for 2023-24 is 0%.
4.7.6 Veterans Upper Secondary Threshold (VUST)
Employer’s NICs relief for veterans was introduced in April 2021 at a prescribed rate of 0%. The Veterans Upper Secondary Threshold (VUST) was introduced in April 2022 – the relief had to be claimed in arrears for the 2021-22 tax year rather than through the payroll. Employers pay a specific rate of NICs on earnings between the Secondary Threshold (ST) and the VUST for employees who are veterans in the first year of civilian employment. The specific rate for 2023-24 is 0%.
4.7.7 Freeport Upper Secondary Threshold (FUST)
The Freeport Upper Secondary Threshold (VUST) was introduced in April 2022 at a prescribed rate of 0%.
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