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Operation of the employment allowance

31 May 2017 / Linda Pullan
Issue: 4601 / Categories: Comment & Analysis
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KEY POINTS

  • The employment allowance came into effect from April 2014.
  • Employers who have not claimed for previous years can submit late claims.
  • Single director companies are not eligible for the allowance.
  • Restriction applies if an employer is penalised for employing illegal workers.

In the 2013 Budget George Osborne then Chancellor of the Exchequer announced that from 6 April 2014 employers and organisations would be able to claim an employment allowance of up to £2 000.

This was legislated in the National Insurance Contributions Act 2014.

Small businesses form about 98% of all employers in the UK and the aim was to support them with the cost of employing staff. However the allowance is available to companies of all sizes charities and community amateur sports clubs.

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