Two months to go until businesses can claim £2,000 cashback on jobs
South Lakes MP Tim Farron has pointed out to local businesses that it is now less than two months until the introduction of the Employment Allowance, which could offer £2,000 off their employer National Insurance Contributions bill.
With only two months to go until the introduction of the Employment Allowance, HM Revenue & Customs (HMRC) has published new guidance for businesses, setting out more details on eligibility and how to claim the allowance.
The forthcoming allowance is worth up to £2,000 off the employer National Insurance Contributions (NICs) bill for 1.25million businesses across the UK. Available from 6 April 2014, it will see 450,000 businesses stop paying NICs altogether. The new HMRC guidance provides businesses with additional information about how to claim the allowance which will be a simple process done through their payroll providers. It also sets out more detail on the types of businesses that will be able to benefit.
According to research conducted by the Federation of Small Business, small businesses will use the Employment Allowance to boost staff wages (29%), employ additional staff (28%) and invest in resources (24%).
The Employment Allowance is available from 6 April 2014. If you are eligible you can reduce your employer Class 1 NICs by up to £2,000 each tax year. You can claim the Employment Allowance if you are a business or charity (including Community Amateur Sports Clubs) that pays employer Class 1 NICs on your employees' or directors' earnings.
Detailed guidance can be found here: https://www.gov.uk/government/publications/employment-allowance-more-detailed-guidance
Tim said: "In exactly two months, businesses across Cumbria will start benefiting from a cashback on jobs - It could be worth up to £2,000. Every business in the county will hopefully see a cut in their National Insurance bill thanks to the Employment Allowance.
"According to the Federation of Small Business, firms will use this money to pay their staff more or hire new employees. This is win-win for both employers and employees."