Employment Allowance


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A prospect was advised that the employment allowance was incorrectly claimed this year and last, only to be subsequently told the claim is valid, after they pointed the finger at their agent.

Their agent is a mid tier firm who run their payroll.  Payroll has 1 director paid over the NIC threshold and no one else.

I've advised otherwise.  Their agent is saying they have checked this several times and they're eligible.

Am I losing my mind or is this just a complete farce?  Surely the claim is not valid?

Replies (4)

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By Mr Hankey
21st Oct 2023 21:13

If that has been the case for the entirety of the tax year, where the only person on the payroll is that director and no one else, then the answer is no, the company is not eligible to claim the employment allowance.

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By Cylhia66
22nd Oct 2023 08:06

Mr Hankey is correct. I would check whether there's been another employee at some point during that tax year.

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By lionofludesch
22nd Oct 2023 10:02

Agree with both the above but check the facts.

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By Barbara G
23rd Oct 2023 08:51

If there was someone else on the payroll during the year, as mentioned in above replies, you also need to check if that person was paid above the NI threshold at any time during the year. My understanding is if the only employee paid above the NI threshold during the year is a director, regardless of the total number of employees paid through payroll, then employment allowance does not apply. If you google Employment Allowance on gov.uk, you can dig further for clarification on this point

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