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Employment Allowance Qualification

One employee paid over the secondary threshold, two directors paid under the threshold...

Hello. I'm having a slight difference of opinion with my business partner. Here is the situation; One employee paid £25,000 a year so over the secondary threshold. Then two directors, both paid just £1200 a year while the business grows. So, question; do they qualify for employment allowance? 

I thought two people must be over the secondary threshold, but this example on HMRC site says: (at https://www.gov.uk/government/publications/employment-allowance-more-det...

Limited company where the director earns below the Secondary Threshold but an employee does not

J Ltd. is a company which has one director and two other employees. The sole director, Mr L, and another employee Miss K, both receive earnings from J Ltd that fall below the Secondary Threshold (£156 a week in 2016 to 2017). The other employee, Mrs J earns above the Secondary Class 1 Threshold. JKL Ltd. will be able to claim the Employment Allowance.

So in this example, two people are under the threshold, but one is above and HMRC say can claim. Although the title of the example says "an employee" (singular).

What if One employee over the secondary threshold and One director under?

Thanks in advance!

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15th Mar 2019 13:12

Your business partner is correct, the company qualifies.

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15th Mar 2019 13:51

If only one person earns over the secondary threshold and that person is a director then you don't qualify. Otherwise you do.

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15th Mar 2019 20:11

They qualify - why is this so hard?

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