Small employers risk losing employment allowance

Plans to remove the employment allowance from large employers could also affect smaller employers the ATT warns.

From April 2020 the employment allowance which currently gives employers a reduction of up to £3 000 to their National Insurance bill will no longer be available to larger employers. As part of this change the allowance will be classified as a ‘de minimis state aid’. This could be problematic for small businesses because there is a maximum amount of de minimis state aid which they can receive in any three-year period. Further although state aid rules are part of EU legislation the government has stated that they will be retained after the UK leaves the EU.

Jon Stride co-chair of the ATT’s technical steering group said small employers that receive grants or tax breaks because they are doing well or contributing something vital to the UK...