Client is currently a sole director on payroll, but looking to use the kickstart scheme to employ a young member of staff. He has asked if he can then apply for employment allowence.
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He doesnt have to pay employers NIC as per below anyway. But how this is implemented there is no clear details. If he claims "employers allowance" then any directors pay will get trawled in. And this maynot be allowable.
I bet if you contact HMRC they wont have a clue. I havent beemn much help really but am interested in the answer.
Funding will cover for each job placement:
100% of the relevant National Minimum Wage for 25 hours a week
the associated employer National Insurance contributions
employer minimum automatic enrolment contributions
Given that the Kickstart scheme also covers the Employers' NI, it would be a little incongruous to get relief for any Employers' NI twice (assuming that the employee is over 21 and attracts any NI in the first place). Depending upon their age, would they even be earning the secondary threshold at NMW?
Not having read the legislation in detail, I presume there would be something in place to say 'no' on the same basis as you couldn't claim EA with CJRS.
You are eligible to claim the employer allowance if you employ an employee over the secondary threshold (even if the rate is 0%) and that employee is not the sole director (also assuming the other criteria for EA are met).
Similar question asked before.
https://www.accountingweb.co.uk/any-answers/is-this-eligible-for-employm...