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 Accounting News & Insights

New Employment Allowance Relief

14th March 2014

On 6 April 2014 the Employment Allowance comes into effect – a new relief which means employers can save up to £2,000 of employer’s National Insurance contributions (NICs) each year.

With one month to go, the Chancellor of the Exchequer, George Osborne, has Helping small businesses in the UK: employment allowance1written a letter for small businesses, to make sure they know about the allowance and how to claim it. It can be claimed by any business or charity (including community amateur sports clubs) that pays NICs on employees’ or directors’ earnings.

The allowance is set against the employer’s entire Class 1 NIC liability each week or month until the maximum £2,000 entitlement is used up. It cannot be set against Class 1A or Class 1B employer NIC. There are no regional restrictions though there are some excluded employers, and also special rules for groups of companies or charities and for employers running more than one PAYE scheme.

All you need to do is claim it using your normal payroll software. This will depend on your package, but will most likely be a box you have to tick.

Source: ICAEW

Ward Williams can assist in operating a payroll scheme and ensure that the relief is claimed.

 


Accounting News & Insights

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