National Insurance Contributions (Employer Pensions Contributions) Bill 2024-26

Clause 1, page 1, line 10, after “tax” insert “at the higher or additional rate"

Clause 1, page 2, line 21, at end insert “, or which make provision altering the method through which the contributions limit, or any equivalent of that limit, is calculated or applied"

Clause 1, page 2, line 27, at end insert- "(5) The amendments made by this section do not apply where the employer – (a) is a small or medium-sized enterprise, or (b) is a charity or social enterprise which meets the conditions in subsection (6). (6) The conditions are that- (a) the employer meets the definition of a small or medium-sized enterprise in section 465 of the Companies Act 2006, and (b) the employment is carried out wholly or mainly for the purposes of that charity or social enterprise. (7) In this section – "charity" has the meaning given by section 1 of the Charities Act 2011; “social enterprise” means an undertaking which- (a) has as its primary purpose the achievement of social or environmental objectives, and (b) principally reinvests its profits for those purposes; “small or medium-sized enterprise” has the meaning given by section 465 of the Companies Act 2006."

Clause 2, page 2, line 38, after “tax” insert “at the higher or additional rate"

Clause 2, page 3, line 32, after “year” insert “, or which make provision altering the method through which the contributions limit, or any equivalent of that limit, is calculated or applied,"

Clause 2, page 3, line 41, at end insert- "(5) The amendments made by this section do not apply where the employer – (a) is a small or medium-sized enterprise, or (b) is a charity or social enterprise which meets the conditions in subsection (6). (6) The conditions are that- (a) the employer meets the definition of a small or medium-sized enterprise in section 465 of the Companies Act 2006; and (b) the employment is carried out wholly or mainly for the purposes of that charity or social enterprise. (7) In this section – "charity" has the meaning given by section 1 of the Charities Act 2011; “social enterprise” means an undertaking which- (a) has as its primary purpose the achievement of social or environmental objectives, and (b) principally reinvests its profits for those purposes; “small or medium-sized enterprise” has the meaning given by section 465 of the Companies Act 2006."

After Clause 2, insert the following new Clause- "Review of impact on small and medium-sized enterprises (1) The Secretary of State must, within 12 months of the passing of this Act, lay before Parliament an independent report assessing the impact of the provisions of this Act relating to employer National Insurance contributions on small and medium-sized enterprises, including social enterprises. (2) The report under subsection (1) must, in particular, assess the impact on – (a) administrative and compliance costs arising from changes to payroll, pension and benefits administration, (b) the complexity of operating salary sacrifice and workplace pension arrangements, (c) employment costs, and (d) the ability of small and medium-sized enterprises to attract, retain and reward staff. (3) The report under subsection (1) must assess the impact of this Act in the context of the cumulative impact of changes to employer National Insurance contributions affecting small and medium-sized enterprises since July 2024.”

Clause 3, page 4, line 5, leave out subsection (2) and insert— “(2) The provisions of this Act, other than this section, may only come into force when a review, meeting the requirements set out in subsections (2A) to (2D), has been completed. (2A) The Secretary of State must commission an independent review of the impact of this Act. (2B) The review must consider - (a) the effect of this Act on pensions adequacy among employees affected by its provisions, (b) the impact of this Act on those affected by its provisions who are also repaying student loans, and (c) the impact of this Act on levels of pension saving and participation in pension schemes. (2C) The person appointed to carry out the review must be independent of His Majesty's Government. (2D) The Secretary of State must publish the report of the review and lay it before both Houses of Parliament."

Clause 3, page 4, line 5, leave out subsection (2) and insert- "(2) The provisions of this Act, other than this section, may not come into force unless and until the conditions in subsections (2A) to (2C) are met. (2A) The Secretary of State must undertake an independent review of the impact of this Act on employers. (2B) The report must in particular consider – (a) the direct and indirect costs incurred by employers as a result of this Act, (b) the effect of the Act on employer pension contributions and the use of salary sacrifice arrangements, (c) the additional compliance costs necessitated by this Act, and (d) any consequential impacts on employment practices, workforce retention or remuneration structures. (2C) The Secretary of State must publish the report of the review and lay it before both Houses of Parliament."

Clause 3, page 4, line 5, leave out subsection (2) and insert— “(2) The provisions of this Act, other than this section, may only come into force when a review, meeting the requirements set out in subsections (2A) to (2C), has been completed. (2A) The Secretary of State must commission a review of the impact of this Act. (2B) The review must consider the impact of - (a) Optional Remuneration Arrangements (OpRa) rules on pensions adequacy and salaries, and (b) the supplementary forecast information release made by the Office for Budget Responsibility on 5 February 2026, titled Costing of charging NICs on salary-sacrificed pension contributions, on the behavioural responses to the provisions in this Act, that underlie the Government's published policy costings. (2C) The Secretary of State must publish the report of the review and lay it before Parliament."

Clause 1, page 1, line 10, after “tax” insert “at the higher or additional rate”

Clause 1, page 2, line 16, at end insert- "(6F) Regulations made under subsection (6A) must include provision explaining- (a) the basis on which the Treasury considers employed earners to be higher earners for the purposes of those regulations; and (b) how the contributions limit specified under subsection (6C) reflects that assessment."

Clause 1, page 2, line 21, at end insert “, or which make provision altering the method through which the contributions limit, or any equivalent of that limit, is calculated or applied"

Clause 1, page 2, line 26, leave out “£2,000” and insert “the amount calculated under subsections (5) and (6)"

Clause 1, page 2, line 26, leave out “£2,000” and insert “£5,000”

Clause 1, page 2, line 26, leave out from “as” to end of line 27 and insert “the amount calculated under subsections (5) and (6). (5) For the tax year 2029–30 the contributions limit must be £2,000 uprated by the percentage change in the retail prices index between 2026–27 and 2028–29. (6) In subsequent tax years the contributions limit must be uprated annually in line with the retail prices index."

Clause 1, page 2, line 26, leave out from “as” to end of line 27 and insert “the amount calculated under subsections (5) and (6). (5) For the tax year 2029-30 the contributions limit must be £5,000 uprated by the percentage change in the retail prices index between 2026–27 and 2028–29. (6) In subsequent tax years the contributions limit must be uprated annually in line with the retail prices index."

Clause 1, page 2, line 27, at end insert- "(5) The amendments made by this section do not apply where the employer - (a) is a small or medium-sized enterprise, or (b) is a charity or social enterprise which meets the conditions in subsection (6). (6) The conditions are that— (a) the employer meets the definition of a small or medium-sized enterprise in section 465 of the Companies Act 2006, and (b) the employment is carried out wholly or mainly for the purposes of that charity or social enterprise. (7) In this section – "charity” has the meaning given by section 1 of the Charities Act 2011; “social enterprise” means an undertaking which – (a) has as its primary purpose the achievement of social or environmental objectives, and (b) principally reinvests its profits for those purposes; “small or medium-sized enterprise” has the meaning given by section 465 of the Companies Act 2006."

Clause 1, page 2, line 27, at end insert- “(5) In 2029-30 the contributions limit must be set at a figure equal to £2,000 uprated by any percentage change in the consumer price index between 2026-27 and 2028-29. (6) In subsequent tax years the contributions limit must be uprated by the same percentage change as that applied to the consumer price index that year.”

Clause 2, page 2, line 38, after “tax” insert “at the higher or additional rate”

Clause 2, page 3, line 28, at end insert- "(6F) Regulations made under subsection (6A) must include provision explaining- (a) the basis on which the Treasury considers employed earners to be higher earners for the purposes of those regulations; and (b) how the contributions limit specified under subsection (6C) reflects that assessment."

Clause 2, page 3, line 32, after “year” insert “, or which make provision altering the method through which the contributions limit, or any equivalent of that limit, is calculated or applied,”

Clause 2, page 3, line 39, leave out “£2,000” and insert “the amount calculated under subsections (5) and (6)"

Clause 2, page 3, line 39, leave out “£2,000” and insert “£5,000”

Clause 2, page 3, line 39, leave out from “as” to end of line 41 and insert “the amount calculated under subsections (5) and (6). (5) For the tax year 2029–30 the contributions limit must be £2,000 uprated by the percentage change in the retail prices index between 2026–27 and 2028–29. (6) In subsequent tax years the contributions limit must be uprated annually in line with the retail prices index."

Clause 2, page 3, line 39, leave out from “as” to end of line 41 and insert “the amount calculated under subsections (5) and (6). (5) For the tax year 2029–30 the contributions limit must be £5,000 uprated by the percentage change in the retail prices index between 2026–27 and 2028–29. (6) In subsequent tax years the contributions limit must be uprated annually in line with the retail prices index."

Clause 2, page 3, line 41, at end insert- "(5) The amendments made by this section do not apply where the employer - (a) is a small or medium-sized enterprise, or (b) is a charity or social enterprise which meets the conditions in subsection (6). (6) The conditions are that – (a) the employer meets the definition of a small or medium-sized enterprise in section 465 of the Companies Act 2006; and (b) the employment is carried out wholly or mainly for the purposes of that charity or social enterprise. (7) In this section – "charity” has the meaning given by section 1 of the Charities Act 2011; “social enterprise” means an undertaking which – (a) has as its primary purpose the achievement of social or environmental objectives, and (b) principally reinvests its profits for those purposes; “small or medium-sized enterprise” has the meaning given by section 465 of the Companies Act 2006."

Clause 2, page 3, line 41, at end insert- “(5) In 2029-30 the contributions limit must be set at a figure equal to £2,000 uprated by any percentage change in the consumer price index between 2026-27 and 2028-29. (6) In subsequent tax years the contributions limit must be uprated by the same percentage change as that applied to the consumer price index that year.”

After Clause 2, insert the following new Clause- "Review of impact on small and medium-sized enterprises (1) The Secretary of State must, within 12 months of the passing of this Act, lay before Parliament an independent report assessing the impact of the provisions of this Act relating to employer National Insurance contributions on small and medium-sized enterprises, including social enterprises. (2) The report under subsection (1) must, in particular, assess the impact on – (a) administrative and compliance costs arising from changes to payroll, pension and benefits administration, (b) the complexity of operating salary sacrifice and workplace pension arrangements, (c) employment costs, and (d) the ability of small and medium-sized enterprises to attract, retain and reward staff. (3) The report under subsection (1) must assess the impact of this Act in the context of the cumulative impact of changes to employer National Insurance contributions affecting small and medium-sized enterprises since July 2024.”

After Clause 2, insert the following new Clause- "Review: impact on SME recruitment and retention (1) The Secretary of State must, within 12 months of the day on which this Act is passed, lay before Parliament a report assessing the effect of the provisions of this Act on small and medium-sized enterprises in relation to the recruitment and retention of staff. (2) The report under subsection (1) must consider the impact of this Act in the context of the cumulative impact of changes to employer national insurance contributions affecting businesses within the scope of this Act since July 2024.”

After Clause 2, insert the following new Clause- “Calculation and publication of lifetime pension values (1) The Secretary of State must calculate and publish illustrative projections of the lifetime value of pension savings before and after the changes made by this Act. (2) For the purposes of this section, “lifetime value” means the total pension income an individual is expected to receive over their lifetime. (3) Projections must- (a) be based on clearly stated assumptions, and (b) include examples covering a range of income levels and pension entitlements."

Clause 3, page 4, line 5, leave out subsection (2) and insert— “(2) The provisions of this Act, other than this section, may only come into force when a review, meeting the requirements set out in subsections (2A) to (2D), has been completed. (2A) The Secretary of State must commission an independent review of the impact of this Act. (2B) The review must consider— (a) the effect of this Act on pensions adequacy among employees affected by its provisions, (b) the impact of this Act on those affected by its provisions who are also repaying student loans, and (c) the impact of this Act on levels of pension saving and participation in pension schemes. (2C) The person appointed to carry out the review must be independent of His Majesty's Government. (2D) The Secretary of State must publish the report of the review and lay it before both Houses of Parliament."

Clause 3, page 4, line 5, leave out subsection (2) and insert— “(2) The provisions of this Act, other than this section, may not come into force unless and until the conditions in subsections (2A) to (2C) are met. (2A) The Secretary of State must undertake an independent review of the impact of this Act on employers. (2B) The report must in particular consider- (a) the direct and indirect costs incurred by employers as a result of this Act, (b) the effect of the Act on employer pension contributions and the use of salary sacrifice arrangements, (c) the additional compliance costs necessitated by this Act, and (d) any consequential impacts on employment practices, workforce retention or remuneration structures. (2C) The Secretary of State must publish the report of the review and lay it before both Houses of Parliament."

7

Clause 1, page 2, line 26, leave out from “as” to end and insert “the amount calculated under subsection (5) for a tax year (but subject to any provision made in reliance on subsection (6C)(a) or (b) of that section).
(5) In 2029-30 the contributions limit must be set at a figure equal to £2,000 uprated by any percentage change in the consumer price index between 2026-27 and 2028-29.
(6) In subsequent tax years the contributions limit must be uprated by the same percentage change as that applied to the consumer price index that year.”

This amendment would uprate the £2,000 cap by the percentage change in the consumer price index during the period before 2029-30, and would require the cap to be uprated by the same percentage as the change in the consumer price index each year thereafter.

8

Clause 2, page 3, lines 39, leave out from “as” to end and insert “the amount calculated under subsection (5) for a tax year (but subject to any provision made in reliance on subsection (6C)(a) or (b) of that section).
(5) In 2029-30 the contributions limit must be set at a figure equal to £2,000 uprated by any percentage change in the consumer price index between 2026-27 and 2028-29.
(6) In subsequent tax years the contributions limit must be uprated by the same percentage change as that applied to the consumer price index that year.”

This amendment would uprate the £2,000 cap in Northern Ireland by the percentage change in the consumer price index during the period before 2029-30, and would require the cap to be uprated by the same percentage as the change in the consumer price index each year thereafter.

5

Clause 1, page 1, line 10, after “income tax” insert “at the higher or additional rate”

This amendment would exempt basic rate taxpayers in England, Wales and Scotland from the £2,000 cap.

1

Clause 1, page 2, line 26, leave out “£2,000” and insert “the amount calculated under subsection (5)”

This amendment, with Amendment 2 would uprate the £2,000 cap by the percentage change in the national living wage during the period before 2029-30, and would require the cap to be uprated by the same percentage as the change in the national living wage each year thereafter.

2

Clause 1, page 2, line 27, at end insert—
“(5) In 2029-30 the contributions limit must be set at a figure equal to £2,000 uprated by any percentage change in the national living wage between 2026-27 and 2028-29.
(6) In subsequent tax years the contributions limit must be uprated by the same percentage change as that applied to the national living wage that year.”

This amendment, with Amendment 1 would uprate the £2,000 cap by the percentage change in the national living wage during the period before 2029-30, and would require the cap to be uprated by the same percentage as the change in the national living wage each year thereafter.

6

Clause 2, page 2, line 38, after “income tax” insert “at the higher or additional rate”

This amendment would exempt basic rate taxpayers in Northern Ireland from the £2,000 cap.

3

Clause 2, page 3, lines 39, leave out “£2000” and insert “the amount calculated under subsection (5)”

This amendment has the same effect as Amendment 1, but for Northern Ireland.

4

Clause 2, page 3, line 41, at end insert—
“(5) In 2029-30 the contributions limit must be set at figure equal to £2,000 uprated by any percentage change in the national living wage between 2026-27 and 2028-29.
(6) In subsequent tax years the contributions limit must be uprated by the same percentage change as that applied to the national living wage that year.”

This amendment has the same effect as Amendment 2, but for Northern Ireland.

NC4

To move the following Clause—
“Reviews of the impact of the Act
(1) The Treasury must, before March 2029, lay before Parliament an assessment of the impact of the changes made under this Act.
(2) The assessment made under subsection (1) must consider—
(a) the adequacy of pension contributions made by or on behalf of individuals affected by this Act,
(b) use of salary sacrifice schemes and optional remuneration arrangements, and
(c) any effects on the investment capability of UK pension funds.
(3) The Treasury must lay before Parliament a follow-up assessment of the impact of the changes made under this Act before March 2034.”

This new clause would require the Treasury to undertake an impact assessment of the effect of the change made under this Act, before they take effect, and again five years later.

NC5

To move the following Clause—
“Calculation and publication of lifetime pension values
(1) The Treasury must calculate and publish the projected lifetime value of an individual’s pension before and after the changes made by under this Act.
(2) For the purposes of subsection (1), the projected lifetime value is the total amount of pension income an individual is expected to receive over their lifetime.
(3) The calculations made under subsection (1) must—
(a) be based on clearly stated assumptions, and
(b) include illustrative examples covering different pension entitlements.”

NC6

To move the following Clause—
“Assessment of changes to pension saving through salary sacrifice schemes
(1) The Chancellor of the Exchequer must, within 15 months of the provisions of this Act coming into effect, lay before Parliament an assessment of the effect of this Act on the amount saved into pensions through salary sacrifice schemes.
(2) The assessment made under subsection (1) must include an—
(a) estimate of the total amount saved into pensions through salary sacrifice schemes in the 12 months preceding the provisions of this Act coming into effect,
(b) estimate of the total amount saved into pensions through salary sacrifice schemes in the 12 months following the provisions of this Act coming into effect, and
(c) an assessment of the difference between those amounts.”

NC1

To move the following Clause—
“Review of impact on SME recruitment and retention
(1) The Treasury must, within 12 months of the passing of this Act, lay before Parliament a report assessing the effect of its provisions on small and medium-sized businesses with regard to the—
(a) recruitment of staff, and
(b) retention of staff.
(2) The report under subsection (1) must also consider the cumulative impact of changes to employer’s national insurance on businesses affected by this Act since July 2024.”

This new clause would require the Treasury to review and report on the impact of the Bill’s provisions relating to National Insurance contributions on the ability of SMEs to recruit and retain staff.

NC2

To move the following Clause—
“Review of impact on small and medium-sized business tax liabilities
(1) The Treasury must, within 12 months of the passing of this Act, lay before Parliament a report assessing the effect of its provisions on small and medium-sized businesses with regard to—
(a) businesses’ overall tax burden,
(b) employment costs, and
(c) business solvency.
(2) The report under subsection (1) must also consider the cumulative impact of changes to employer’s national insurance on businesses affected by this Act since July 2024.”

This new clause would require the Treasury to review and report on the impact of the Bill’s provisions relating to National Insurance contributions on the overall tax burden and employment costs faced by SMEs.

NC3

To move the following Clause—
“Review of impact on employee marginal tax rates
(1) The Treasury must, within 12 months of the passing of this Act, lay before Parliament a report assessing the effect of its provisions on the number of employees brought into a higher marginal rate of income tax.
(2) The report under subsection (1) must give particular regard to the impact of the freezing of income tax thresholds between April 2022 and April 2031.”

This new clause would require the Treasury to review and report on the impact of the Bill’s provisions relating to National Insurance contributions on the number of employees who move into a higher tax band due the increase in their taxable income due to the effects of this Bill.