Thursday 6 March 2014

£2,000 Employment Allowance for the new tax year

Big News for the upcoming tax year 2014/15.

If you are an employer, you can reduce the amount of Employer National Insurance Contributions (NICs) you pay for your employees by up to £2,000. This is called the ‘Employment Allowance’.


Employment Allowance can be claimed from 6 April 2014. This would mean that you won’t have to pay any employer National Insurance contributions at all if you usually pay less than £2,000 a year.

Employment Allowance is for nearly all employers that pay Class 1 National Insurance contributions on their employees’ and directors’ earnings. This includes:
  • businesses
  • charities
  • community amateur sports clubs


Up to 1.25 million businesses and charities will benefit from Employment Allowance. Around 450,000 businesses and charities won’t have to pay any employer National Insurance contributions at all.

There are a small number of businesses and organisations that can’t claim Employment Allowance.