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Employment Allowance Update

November 2014

You may have recently seen a television advert run by HMRC promoting employment allowance. Employment allowance is legislation that allows businesses to claim, as of April 6th 2014, up to £2,000 a year in class 1 national insurance contributions. If your class 1 NIC contributions are less than £2,000 you will not have to pay anything.

It is estimated that over 1 million businesses and charities will benefit, with around 450,000 not having to pay any contributions at all.

Eligible

Ineligible

BusinessesDomestic employer who employs for personal use i.e. gardener
CharitiesPublic body I.e. local council
Community Amateur Sports ClubService company with only deemed payments of employment income

 

The change will encourage businesses to grow and employ more staff, making it cheaper and easier to do so. The government have also abolished national insurance contributions for under 21 year olds on earnings up to £813 a week.

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Did you know... 💭 All charitable incorporated organisations (irrespective of income) and those registered charities with a gross income in the financial year exceeding £25,000 must file their accounts and an annual report with the commission. #charity pic.twitter.com/LEhRNp8XyE

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