Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the impact of the Health and Social Care Levy on the earnings of (a) freelance and (b) other off-payroll workers.

The Government has made several assessments of the overall impact of the introduction of the Health and Social Care Levy, including in the Tax Information and Impact Note for the measure which was published on gov.uk.

From April 2022, all eligible employees and self-employed individuals will pay the 1.25 percentage point increase in National Insurance contributions (NICs), and the Health and Social Care Levy from April 2023. This includes eligible freelancers and off-payroll workers.

Off-payroll workers who fall inside the off-payroll working rules as deemed employees, and their deemed employers, are included in the scope of the Levy, as the Levy applies wherever there is a Class 1 NICs liability. It will be the responsibility of the deemed employer to pay the employer Levy contribution and deduct the employee Levy contribution.

The increase to the NICs Primary Threshold/Lower Profits Limit announced at the Spring Statement 2022 means that, from July, around 70 per cent of NICs payers will be better off, even when taking the Levy into account.