Difference between revisions of "How do I claim employment allowance?"

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== Summary ==
 
== Summary ==
The Employment Allowance is available from 6 April 2014. If you are eligible you can reduce your Employer Class 1 NICs by up to £3,000 each tax year.  
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If you are eligible for Employment Allowance you can reduce the amount of Employer Class 1 NICs due by up to £4000 for the tax year 2021-2022.
  
{{Note|text=As of 6 April 2016.}}
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{{Note|text=Please click  [https://www.gov.uk/claim-employment-allowance here] to check the allowance in the current tax year and to see if you are eligible to claim the allowance. Please bear in mind there are various rules concerning eligibility including the thresholds for De Minimis state aid, and it is your responsibility to understand and adhere to the rules and regulations.}}
  
 
== More Information ==
 
== More Information ==
You can claim the Employment Allowance if you are a business or charity (including Community Amateur Sports Clubs) that pays employer Class 1 NICs on your employees’ or directors’ earnings.
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You can claim the Employment Allowance if you are a business or charity (including Community Amateur Sports Clubs) that pays employer Class 1 NICs on your employees' or directors' earnings.
  
 
If your company belongs to a group of companies or your charity is part of a charities structure, only one company or charity can claim the allowance. It is up to you to decide which company or charity will claim the allowance.
 
If your company belongs to a group of companies or your charity is part of a charities structure, only one company or charity can claim the allowance. It is up to you to decide which company or charity will claim the allowance.
  
You can only claim the £3,000 Employment Allowance against one PAYE scheme - even if your business runs multiple schemes.
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You can only claim the Employment Allowance against one PAYE scheme - even if your business runs multiple schemes.
  
 
You can find [https://www.gov.uk/claim-employment-allowance more information about Employment Allowance on the HMRC website].
 
You can find [https://www.gov.uk/claim-employment-allowance more information about Employment Allowance on the HMRC website].
  
 
=== If you can claim ===
 
=== If you can claim ===
If you are entitled to claim Employment Allowance then you must send an Employer Payment Summary (EPS) each calendar month and Platinum will automatically claim the Employment Allowance when you do.
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At the end of each tax month you should submit an [[How do I close a payroll period?#Employer Payment Summary (EPS)|'''E'''mployer '''P'''ayment '''S'''ummary (EPS)]]
{{Note|text=The Employer '''N'''ational '''I'''nsurance '''C'''ontribution total will be reduced by the value of £3000. If your Employer N.I.C is lower than £3000 a period it will be spread over the course of multiple periods. This will be shown on the [[How do I Close a Payroll Period?#Employer Payment Summary (EPS)|'''E'''mployer '''P'''ayment '''S'''ummary (EPS)]] and currently not on the P32 print out.}}
 
  
=== If you cannot claim ===
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* Go to {{Menu|{{PR}}|Monthly Payroll Routines|Employer Payment Summary|View or Submit an EPS}}.
If you are not entitled to claim Employment Allowance then you will need to switch off this setting in Platinum:
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* Ensure the {{DataPrompt|Claim employment allowance?}} drop down is set to {{DataValue|Yes}}.
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* Employers are also required to state whether or not they provide goods or services to certain markets as part of the submission.
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* In the {{DataPrompt|De minimis state aid}} box:
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** At {{DataPrompt|Agriculture:}}, choose {{DataValue|Yes}} if the business provides goods or services to the agricultural market.
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** At {{DataPrompt|Fisheries and aquaculture:}}, choose {{DataValue|Yes}} if the business provides goods or services to the fisheries and aquacultural market.
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** At {{DataPrompt|Road transport:}}, choose {{DataValue|Yes}} if the business provides goods or services to the road transport market.
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** At {{DataPrompt|Industrial:}}, choose {{DataValue|Yes}} if the business provides goods or services to the industrial market.
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{{Note|text=The Employer '''N'''ational '''I'''nsurance '''C'''ontribution total will be reduced by the allowance until the full allowance has been used. This may result in the allowance being spread over the course of multiple periods at the start of the tax year.}}
  
# Go to {{PayrollSettings|Company Parameters|General Company Details}}.
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{{Warning|text=The amount of ''NIC's'' due, less the allowance is shown on the [[How do I close a payroll period?#Employer Payment Summary (EPS)|'''E'''mployer '''P'''ayment '''S'''ummary (EPS)]] and currently not on the P32 print out. You must submit an ''EPS'' at the end of each Tax Month to ensure HMRC are aware you are claiming your allowance.}}
# Change {{DataPrompt|Employment Allowance?}} to {{DataValue|N}}.
 
  
After you do this then Platinum will no longer claim Employment Allowance in your monthly Employer Payment Summary (EPS). For the tax year ending 5th April 2015, you may find that it is still displayed on the {{Tab|Summary}} tab when you are filing the EPS even with the flag set to {{DataValue|N}}, but so long as you are sure that the flag is set to {{DataValue|N}}, then the correct information will be sent to HMRC and you may ignore it.
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=== If you cannot claim ===
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If you are not entitled to claim Employment Allowance:
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* While sending your monthly [[How do I close a payroll period?#Submitting the Employer Payment Summary (EPS)|Employer Payment Summary (EPS)]] choose {{DataValue|No}} at the {{DataPrompt|Claim employment allowance?}} prompt.
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* Having done so your breakdown and summary figures will be recalculated so that they no longer include Employment Allowance.
  
 
== See also ==
 
== See also ==
*[[How do I Close a Payroll Period?]]
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* [[How do I close a payroll period?]]
*[[How do I Close a Payroll Period?#Employer Payment Summary (EPS)|Employer Payment Summary (EPS)]]
 
 
* [https://www.gov.uk/claim-employment-allowance Employment Allowance]
 
* [https://www.gov.uk/claim-employment-allowance Employment Allowance]
* [[How do I Post the Wages Journal?]]
 
  
{{KB_Tags|Payroll, params, parameters, settings, EPS, Employer, Payment, Summary, Employer Payment Summary, NIC, 3000, Claim, Reclaim, Re Claim, Re-Claim, employment, allowance, wages journal}}
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{{KB_Tags|payroll, params, parameters, settings, eps, employer payment summary, nic, claim, reclaim, re claim, re-claim, employment, allowance, wages journal, state aid, de minimis}}
{{KB_PR}} {{FAQ}}
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{{FAQ}}{{How}}{{KB_PR}}

Latest revision as of 06:28, 12 March 2021

Summary

If you are eligible for Employment Allowance you can reduce the amount of Employer Class 1 NICs due by up to £4000 for the tax year 2021-2022.

Please click here to check the allowance in the current tax year and to see if you are eligible to claim the allowance. Please bear in mind there are various rules concerning eligibility including the thresholds for De Minimis state aid, and it is your responsibility to understand and adhere to the rules and regulations.

More Information

You can claim the Employment Allowance if you are a business or charity (including Community Amateur Sports Clubs) that pays employer Class 1 NICs on your employees' or directors' earnings.

If your company belongs to a group of companies or your charity is part of a charities structure, only one company or charity can claim the allowance. It is up to you to decide which company or charity will claim the allowance.

You can only claim the Employment Allowance against one PAYE scheme - even if your business runs multiple schemes.

You can find more information about Employment Allowance on the HMRC website.

If you can claim

At the end of each tax month you should submit an Employer Payment Summary (EPS)

  • Go to " Payroll Monthly Payroll Routines Employer Payment Summary View or Submit an EPS".
  • Ensure the "Claim employment allowance?" drop down is set to 'Yes'.
  • Employers are also required to state whether or not they provide goods or services to certain markets as part of the submission.
  • In the "De minimis state aid" box:
    • At "Agriculture:", choose 'Yes' if the business provides goods or services to the agricultural market.
    • At "Fisheries and aquaculture:", choose 'Yes' if the business provides goods or services to the fisheries and aquacultural market.
    • At "Road transport:", choose 'Yes' if the business provides goods or services to the road transport market.
    • At "Industrial:", choose 'Yes' if the business provides goods or services to the industrial market.
The Employer National Insurance Contribution total will be reduced by the allowance until the full allowance has been used. This may result in the allowance being spread over the course of multiple periods at the start of the tax year.
The amount of NIC's due, less the allowance is shown on the Employer Payment Summary (EPS) and currently not on the P32 print out. You must submit an EPS at the end of each Tax Month to ensure HMRC are aware you are claiming your allowance.

If you cannot claim

If you are not entitled to claim Employment Allowance:

  • While sending your monthly Employer Payment Summary (EPS) choose 'No' at the "Claim employment allowance?" prompt.
  • Having done so your breakdown and summary figures will be recalculated so that they no longer include Employment Allowance.

See also


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Keywords AND Misspellings
payroll, params, parameters, settings, eps, employer payment summary, nic, claim, reclaim, re claim, re-claim, employment, allowance, wages journal, state aid, de minimis