National Insurance Contributions (Secondary Class 1 Contributions) Act

The Act changes how employers’ secondary Class 1 National Insurance contributions are calculated by setting a new rate and threshold. It also increases the employment allowance for employers and removes the £100,000 threshold, expanding NIC relief for firms.

The Lords’ marshalled list records amendments to the National Insurance Contributions (Secondary Class 1 Contributions) Bill, including creating a 'specified employer' category of NHS, social-care and related providers to be charged a 13.8% secondary contribution rate and giving the Treasury power to exempt other categories by regulations. It also proposes exemptions from thresholds and a post‑enactment sector review, with Lords providing in‑lieu amendments. The Commons oppose these measures on revenue grounds and have put forward competing reasons and amendments for consideration.

This Lords amendment paper lists four motions for the Lords to decide, after the Commons disagreed with four amendments to the National Insurance Contributions (Secondary Class 1 Contributions) Bill. The motions state that the Lords do not insist on Amendments 1B, 5B, 8B and 21B (to Clauses 1, 2 and After Clause 3) in response to the Commons’ reasons 1C, 5C, 8C and 21C, effectively accepting the Commons’ position. Published 27 March 2025.

The Lords Bill would create a new 'specified employer' category for certain health and social care providers and similar services, applying a higher secondary Class 1 National Insurance rate of 13.8% to them and setting a new threshold of £175 for these employers. It also allows regulations to exempt other categories from the changes and requires a government review of the Act’s impact on sectors such as charities, hospices, hospitality and social care within six months of enactment. The Commons oppose the changes as affecting public revenue, and while the Lords proposed in‑lieu amendments offering exemptions and sector-specific review, the Commons maintained their objections.

The Lords’ marshalling list presents multiple Lords amendments to the National Insurance Contributions (Secondary Class 1 Contributions) Bill that would create a ‘specified employer’ category (covering NHS/social care providers, charities, dentists, pharmacists, hospices, and related services across the UK) with a 13.8% secondary employer rate and various exemptions, plus provisions to grant exemptions by regulations; there are England, Wales, Scotland and Northern Ireland variants. The Commons oppose these amendments on the grounds that they affect public revenue, and the list also includes proposed post-enactment sector impact reviews (including an alternative 21B version).