National Insurance on the Rise - Are you Prepared?

Hi everyone,     

The recent 2024 Labour Budget has set the stage for big changes to National Insurance Contributions (NIC) for employers – and that includes every dental practice out there.  

With NIC for employers rising by 1.2%, from 13.8% to 15%, and the threshold drop from £9,100 to £5,000, it’s time to reassess payroll strategies. 

Crunching the Numbers 

To put it in perspective, practices paying NIC on staff wages above £9,100 annually will now start paying on earnings above £5,000 – and at a higher rate.  

For those already feeling the pinch of staffing costs, this could mean a significant increase in expenses. For smaller practices and solo practitioners, this shift is something that simply can’t be ignored. 

In this new landscape, planning becomes crucial. Every extra percentage in NIC is another cost that chips away at your bottom line, meaning even small miscalculations in payroll budgeting can add up significantly over time.  

As costs continue to rise, finding efficient, cost-effective solutions in practice operations and employment structures will be essential for navigating this financial shift without compromising your practice’s stability or team morale. 

Payroll, Hiring, and Growth Impact 

This change, which kicks in April 2025, has implications beyond just paying a bit more. Higher employer NIC contributions mean businesses might need to get creative with budgets, staff allocations, and even wage negotiations.  

Many practice owners may now be asking: How can we maintain a fair wage for our teams while absorbing these costs? Are hiring freezes or automation investments on the horizon to offset this? 

Support for Small Practices, But Is It Enough? 

On the bright side, Labour’s budget includes a boost in Employment Allowance, raising it from £5,000 to £10,500. This increase, aimed at small businesses, gives qualifying practices a bit more wiggle room.  

But will it be enough for smaller clinics to truly balance the books? For larger practices, or those close to the £100,000 liability cap, this allowance won’t have the same impact. 

Where to Go from Here 

So, how will your practice absorb this, and what could this mean for your team dynamics? 

As practices start to feel the weight of these rising costs, it’s worth considering a shift for roles that don’t need to be in-clinic. From admin and bookkeeping to marketing and social media, many essential functions can be handled efficiently and affordably by our dedicated team in India. 

Ready to explore how this could work for your practice?  

Book a call with us today to see how outsourcing can help you streamline costs and keep your focus on what matters most: patient care. 

Until next time, 

Arun