Merging income tax and NICs: how would it work in practice?

Calls are made regularly to merge tax and national insurance contributions (NICs), and once again, the issue is back on the agenda as the Office of Tax Simplification is charged with a new remit to review possible merger options. Sarah Bradford ACA CTA considers the pros and cons

Following the Summer Budget, the financial secretary to the Treasury, David Gauke, wrote to the Office of Tax Simplification (OTS) to ask them to undertake a study into the closer alignment of tax and national insurance contributions (NICs). The OTS has taken up the mantel and published its terms of reference.

At this stage, the aim is to build on the OTS’s earlier work and recommendations in this area in order to understand the different stages in improving the alignment of tax and national insurance (NI).

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