The increase in employers’ National Insurance contributions (NICs) is beginning to show as over the last three months businesses have paid almost £5bn more than last year
The overall tax takes increased by £11.76bn between April and June 2025, soaring to £209.6bn in just three months. Almost £5bn of this increase has come directly from employers’ NICs.
Income tax, capital gains tax and NICs have accounted for £120.5bn of the total tax take so far this year, £9.4bn higher than last year. From April this year employers’ NICs rose to 15% from 13.8% while the threshold was also reduced to £5,000 from £9,100 on the same day which is heavily impacting the amount paid by businesses.
The tax was targeted by Rachel Reeves in October 2024’s Budget as a way to clog with ‘£20bn black hole’ but is expected to rake in closer to £25bn this year.
Between May and June 2024 £17.586bn was paid in employers NICs at the lower rate of 13.8%. In the same period of 2025 businesses have paid out £21.6bn, with June alone falling just shy of £11bn.
Employers’ have paid 17% more over the first few months of this being enforced, up to £34.283bn from £29.342bn.
When does an employer pay National Insurance?
However, as the hospitality and retail sector accounts for 45% of the total number of jobs lost since April it seems working people are the very ones impacted by these changes most as making it more expensive to employ people has forced businesses to make cuts to employees on minimum wage.
Not only is employers’ NICs on the rise, but the corporation tax reached a high of £13.02bn in June another rise that could impact the job market in the long run.
Some tax changes have not had the intended outcome though as the amount paid in capital gains tax (CGT) has been consistently dropping over the past few years. The 2022-23 tax year saw £16.9bn paid in CGT, which then fell to £14.49bn in 2023-24, and then again dropped to just over £13bn.
Shaun Moore, tax and financial planning expert at Quilter, said: ‘In the first six months of the year, CGT has raked in £11.8 billion, compared to £13.5 billion during the same period last year.
