From next month the threshold at which people begin to pay National Insurance will rise by £3,000 to £12,570, bringing it in line with the personal allowance threshold for tax.
Previously employees below State Pension age earning over £9,570 would pay NICs at 12% (9% for self-employed).
This significant rise represents a tax saving worth over £330 and means more than 70% of workers will pay less tax, helping those on the lowest incomes as the cost of living crisis intensifies.
The Chancellor pressed on with his planned National Insurance rate increase of 1.25%. So while the threshold at which you begin to pay will increase, the rate at which you pay is set to rise.
What does this mean? Well, someone earning £20,000 will save £178 in National Insurance Contributions, meanwhile someone earning £50,000 will pay £197 more.