National insurance, side hustle tax - and saving money
And we’re back!
It feels like there’s a slower start to this year, compared with previous years. Hopefully it means that we’re listening to our bodies and environments more (it’s WINTER, why make life harder than it needs to be, with goals just because we feel we should be improving ourselves from 1 January?!).
I have strong feelings..!
Now remains, in my opinion, a great time to keep reflecting and thinking about changes you might like to implement, and goals you’d like to work towards. And, when the time is right, know that you’ll be ready to take action 😊
PS Our next event is on 20 January - see you there?
1. Who will benefit most as UK national insurance cut takes effect?
The Guardian
This is the first of two big policy changes that may have an effect on you. The Government is cutting the main rate of national insurance contributions (NICs) paid by employees from 12% to 10%, effective yesterday (6 January).
The “class 1” contributions are made on earnings received by anyone between the age of 16 and state pension age who is getting more than £242 a week from one job. You have to pay them, and they are automatically deducted by your employer.
Employees will now pay 10% on earnings between £242 and £967 a week. They pay 2% on all earnings above £967 a week – which equates to an income of £50,284 a year. The Treasury says this is “the largest ever cut to national insurance” and that 27 million workers will benefit.
The Treasury says that for an average employee on a salary of £35,400, the reduction is worth £450 a year.
ACTION: Check your next payslip (something you no doubt do already 😇) and look at your NIC contribution; has it changed from last month? Speak to your HR team too, as they should be able to explain any changes in simple terms.
2. Airbnb, eBay, Vinted and other apps to share more information with HMRC
BBC News
And this is the second big policy story, affecting anyone who is trying to make more money.
The ‘side hustle tax’ has been around for a while (up to £1,000 is non-taxable as it’s within your trading allowance, but above is taxable). And, previously, HMRC was able to access sellers' information from UK-based online platforms when required. But now, firms will pass on data to HMRC automatically if you're selling 30 or more items a year or have total earnings over £1,700.
The Government says it’s more targeting individuals and organisations making a lot of money from these platforms. rather than regular people. But you should know if you’re going to be affected if you do sell on any online platform.
ACTION: Know if you will be affected. If the total amount you earn via a platform in a tax year is above £1,000, you likely need to tell HMRC and may have to pay tax on this.
3. 5 ways to save money (that have nothing to do with money)
The Cut
Tips include walking more, and going to bed earlier. Why? Because it keeps you distracted and physically less able to spend too much 😂
But this article feels important because it looks at money as a part of your life. Not something separate. So, if you have ‘healthier’ and more holistic things you’re focusing on or investing time into, you’ll likely feel more grounded and therefore able to make decisions more beneficial to both your current and future selves.
ACTION: Think about how you might want to make some non-money related actions, to live a happier (and hopefully better value) life this year.
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