Changes to Employment Allowance

From the 6th April 2020, eligibility rules for claiming the Employment Allowance (EA) are changing. This will mean that professional bodies will need to provide updates to their members, whilst tax agents and advisers need to make sure their clients are ready for the change; this is something we will be doing following this update.

In short, the changes mean that in order to make a new EA claim, extra eligibility checks are required beforehand. Which includes checking de minimis state aid. EA will continue to be claimed through your Employer Payment Summary (EPS), but claims will not renew and you will need to remember to make a new EA claim each year.

 

Remember to let your payroll administrator know whether you’re eligible or not.

 

Key Points to Know:

  • From 6 April 2020 you can only claim the employment allowance (£3,000) if your employer’s NIC was below £100,000 in the tax year before the year of the cliam. E.g. if above £100k in 2019/20 you can’t claim employment allowance in 2020/21.
  • You do not include deemed payments in your calculations (e.g. payments to off payroll workers).
  • You do add together the employer’s NIC from all payrolls and connected companies.
  • If you receive state aid, you also cannot claim the employment allowance if it takes you over the de minimis state aid ceiling for your business sector.

 

If you would like to discuss these changes further with a member of our team, please click here to get in contact with us.

Coronavirus/COVID-19 Update

We are still here to help you

We have activated our plan for our team to work remotely as much as possible. The office is still open and there will always be someone on reception in normal working hours but for obvious reasons, the telephone and email are the best way to contact us as we follow the UK Government guidance to reduce contact.

If you have any direct questions about your business and the effects of the virus please get in touch with your usual contact or directly to me david@kirkhills.co.uk or adrian@kirkhills.co.uk