Key Changes to Payroll in 2025
Several key payroll changes have taken effect or are anticipated in 2025. These include National Insurance Contributions (NIC) changes, National Living Wage (NLW) and National Minimum Wage (NMW) increases, and the introduction of Statutory Neonatal Care Leave and Pay (SNCL&P).
Key Payroll Changes for 2025:
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National Insurance Contributions (NIC):
- From April 6, 2025, employer NIC rates will increase from 13.8% to 15% on earnings above the Secondary Threshold.
- The Secondary Threshold is also decreasing from £9,100 to £5,000, meaning employers will pay NICs on a larger portion of employee earnings.
- From April 6, 2025, employer NIC rates will increase from 13.8% to 15% on earnings above the Secondary Threshold.
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National Living Wage (NLW) and National Minimum Wage (NMW):
- The NLW and NMW rates will be increased from April 1, 2025.
- This change, particularly for younger workers (18-20 year olds and 16-17 year olds and apprentices), reflects a significant increase in the hourly rate.
- The NLW and NMW rates will be increased from April 1, 2025.
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Statutory Neonatal Care Leave and Pay (SNCL&P):
- This new policy, introduced from April 6, 2025, provides eligible parents up to 12 weeks of additional paid leave when their baby requires neonatal care.
- This new policy, introduced from April 6, 2025, provides eligible parents up to 12 weeks of additional paid leave when their baby requires neonatal care.
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Other Statutory Payment Increases:
- The Statutory Sick Pay (SSP) rate and other statutory payment entitlements will also be updated.
- The Statutory Sick Pay (SSP) rate and other statutory payment entitlements will also be updated.
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PAYE and NIC Thresholds:
- The thresholds for PAYE and National Insurance contributions will also be updated for the new tax year.
