The Autumn Budget announced changes to employer National Insurance Contributions (NICs) and a rise in the National Living Wage (NLW).
For many businesses, especially SMEs, these changes could be a turning point and not necessarily a positive one.
Payroll headaches could become more severe, so could outsourcing be the solution?
Breaking down the Budget’s impact on payroll
Let’s start with the numbers.
The secondary threshold for employer NICs has been slashed from £9,100 to £5,000.
For businesses, that means paying NICs on a much greater portion of employee earnings.
If you are running payroll in-house, that means more calculations and ultimately, more costs.
Pair that with the rise in the NLW to £12.21 per hour from April 2025, an increase of up to £1,400 annually per full-time employee, and things become more challenging.
The phased extension of the NLW to workers aged 18 and over adds another layer of complexity.
Whether it is cutting costs elsewhere, rethinking staffing levels, or tightening margins, the ripple effect of these payroll changes will be felt across industries.
Why outsourcing payroll can make a difference
The many layers of payroll – compliance, accuracy, and efficiency, can upset your financial planning.
Outsourcing payroll is therefore a strategic decision that can improve the overall financial picture of your business.
Stay compliant, effortlessly
The changes to NIC thresholds and wage regulations are just the tip of the iceberg.
Our payroll team can help you stay on top of legislative updates, ensuring your business remains compliant without the constant need for internal training or new software.
Save time and focus on growth
Do you really want your team bogged down by payroll calculations, reporting deadlines, and queries from HM Revenue & Customs (HMRC)?
Outsourcing frees up your time, allowing you to focus on growing your business and serving your customers.
Avoid costly errors
As payroll becomes more challenging, the risk of errors increases.
Outsourcing your payroll to our team allows our experts to handle complexities, minimising errors that could lead to fines or unhappy employees.
A solution for uncertain times
It is no secret that many businesses are already stretched thin.
Rising costs, combined with the lingering effects of the pandemic and cost-of-living crisis, leave little room for error.
While the Government’s increase in the Employment Allowance and relief on business rates offer some respite, they won’t be enough for every business to offset these new payroll challenges.
By handing over payroll to experts, you can safeguard your business against compliance risks, unexpected costs, and the additional administrative workload.
Get in touch with Dan Sayers (dan.sayers@mjbushell.co.uk) or Georgina Trembling (georgina.trembling@mjbushell.co.uk) today and discover how we can simplify your payroll process, save you time, and let you focus on what you do best.