Employment allowance

Employment allowance will reduce your employers’ (secondary) Class 1 National Insurance each time you run your payroll until the (Undefined variable: General.Employement Allowance inc year) has gone or the tax year ends (whichever is sooner).

Check Your Eligibility

You can claim Employment Allowance if:

  • You are a business or charity (including community amateur sports clubs) paying employers’ Class 1 National Insurance.

  • You employ a care or support worker.

You can only claim Employment Allowance for one PAYE scheme.

If you are part of a group, only one company or charity in the group can claim the allowance.

You cannot claim if:

  • Your Employer's NI contribution bill for the previous year was over (Undefined variable: General.Employ allowance threshold).

  • Your EA claim will push you above the De minimis state aid threshold applicable to your industry sector.

  • You are the Director and only paid employee in your company.

  • You employ someone for personal, household, or domestic work (e.g. a nanny or gardener) – unless they are a care or support worker.

  • You are a public body or business doing more than half your work in the public sector (e.g. local councils and NHS services) – unless you are a charity.

  • You are a service company with only deemed payments of employment income under ‘IR35 rules’.

If you are unsure about your eligibility to claim employment allowance, please contact HMRC on 0300 200 3200 for clarification.

Further Employment Allowance guidance.

You will also need to select your business sector for the purposes of de minimis state aid.