Employment Allowance is now £3,000 but not for everyone
For the last 2 years there has been a £2,000 allowance available to employers to set against their employers National Insurance liability for the year. This increased to £3,000 from 6 April 2016 and no action is required if you claimed the allowance for 2015/16. However, from 6 April 2016, limited companies where the director is the only employee paid earnings above the Secondary Threshold for Class 1 National Insurance Contributions (£156 a week) will no longer be entitled to claim the allowance.
HMRC guidance states that if more than one employee or director earns above the Secondary Threshold, the company will continue to be eligible for Employment Allowance for the whole tax year. This other employee could be the director’s spouse or partner. The HMRC guidance is not consistent with the legislation however and we hope to clarify the matter so that you don’t miss out.
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One of the areas where there may be a change in your company’s accounts is where you have received or made a loan that is interest free or at less than market rates. Unless the loan is repayable on demand the new accounting rules require the loan to be recorded in the accounts on an amortised cost basis.
View article about Interest Free Loans and the New Accounting RulesAnyone who is currently being paid a salary of £670 per month (or £155 per week) in order to secure National Insurance Contributions should note that, as there has been no increase in the National Insurance bands from 6 April 2016, this continues to be the amount to pay for 2016/17.
View article about Directors and others on minimum salary 2016/17What our clients say






