Budget 2018 announced that from 6 April 2020 the EA would be restricted to employers whose secondary NIC contributions were less than £100,000 in the preceding tax year.
Due to this restriction the Employment Allowance is now considered to be de minimis state aid and will require eligible businesses to monitor and reconcile the total de minimis state aid that they receive over a three year period, which for the purposes of Employment Allowance will include, de minimis aid received in the previous two years from all sources, plus the year ahead from 6 April 2020. A public authority that grants de minimis state aid will have provided written evidence of the amount granted and so it is important that all records relating to state aid are retained for three years. HMRC will issue such a notification to confirm that the employer has eligibility to claim Employment Allowance. Going forward employers will need to claim EA each year, their payroll software will no longer enable them to automatically carry forward their authorisation without reconfirming their eligibility, which will be based on their secondary NICs in the preceding tax year (which will include all secondary NIC liability for connected or group situations) as well as the amount they have been granted in de minimis state aid.
The Employment Payment Submission (EPS) will be used to indicate that an employer is making a claim and will need to include which sector the employer operates, which will be:
• Primary production of agriculture products €20,000 • Fisheries and aquaculture sector €30,000 • Road freight transport sector €100,000 • Other €200,000
Class 1 secondary liability will not include the liability incurred from the ‘deemed payments’ processed for off-payroll workers.
For full information please read the HMRC guidance .
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Chancellor expected to introduce tax break for employers who hire veterans 10 March 2020 It is expected that, as per the pledge made in the Conservative Manifesto, Chancellor Rishi Sunak will announce a new tax break for employers who hire force veterans, along with a raft of other changes at Budget on Wednesday 11 March. Employers who hire ex-forces personnel will no longer have to pay any employer National Insurance (NI) contributions for the first year of their work, in a bid to boost the number of veterans who get straight into work. It is estimated that approximately 15,000 sailors, soldiers and airmen leave the services each year so this could benefit a substantial amount of individuals and the employers that hire them.
Armed Forces Minister, Johnny Mercer, tweeted:
“Having a job is the single biggest driver of life chances in Veterans. So we’re waiving National Insurance contributions for employers for the first year that they hire a veteran. Determined this country will top the table on Veterans care.” Rishi Sunak commented:
“The UK owes all ex-servicemen and women a tremendous debt for serving our country and keeping us safe - so it is only right we help them in every possible way.
My Budget will deliver on the promises we've made to veterans - and to the rest of the British people."
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The Chartered Institute of Payroll Professionals
Payroll: need to know
cipp.org.uk
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