Almost all private sector employers can claim the annual employment allowance worth up to £2,000, to set against employers NIC in the tax year 2015/2016. Not all employers are eligible for the allowance and eligibility can be checked on the HMRC website. This allowance is not available for:
- Anyone who employed someone as a nanny or for household or domestic duties
- Employers already claiming through a connected business or charity
- Public authorities which are not charities
- Employers who carry out functions either wholly or mainly of a public nature, unless they have charitable status
- Service companies cannot claim in respect of deemed payments of salary
The employment allowance will increase to £3,000 for 2016/17. For very small companies, where the owner is the only employee, they will not be able to claim the allowance from 2016/17 onwards.
For more information go to: www.hmrc.gov.uk/nicsemploymentallowance