Does Employment Allowance cover Class 1A NIC?

Does Employment Allowance cover Class 1A NIC and if so how do you claim it?

Didn't find your answer?

I need to do a P11D for a client who has Employment Allowance left from 2021-22. I assume that the Employment Allowance can be used against the Class 1A liability. If that is the case does anyone know how you claim it when using HMRC's online P11D submission system? Thanks for any help!

Replies (3)

Please login or register to join the discussion.

avatar
By Hugo Fair
16th Jun 2022 12:15

No (it doesn't)!

Why do you "assume that the Employment Allowance can be used against the Class 1A liability"?

The guidance clearly states it is used to "pay less employers’ Class 1 National Insurance each time you run your payroll until the £5,000 has gone or the tax year ends (whichever is sooner)."
And the purpose is to make it less costly for a very small employer to take on a new member of staff - not to subsidise BiKs.

Thanks (4)
Replying to Hugo Fair:
avatar
By Hugo Fair
16th Jun 2022 12:19

BTW ... it is the very first item in HMRC's "Claiming Employment Allowance: further employer guidance" ... https://www.gov.uk/government/publications/employment-allowance-more-det...

"1. The Employment Allowance can only be used against your employer Class 1 NICs liability. It can not be used against Class 1A or Class 1B NICs liabilities."

Thanks (6)
DougScott
By Dougscott
16th Jun 2022 13:00

Thanks Hugo - that link makes it pretty clear!

Thanks (0)