As a start up business you might be eligible for an NIC holiday, for a limited period and subject to meeting certain conditions. This could mean up to £5,000 from the employer NICs that would normally be due - for each of the first ten employees you take on.
Follow the steps below to check whether you qualify or if you are using an outsourced payroll company they should do it for you.
So how do you qualify:
New Business Start Date: From 22 June 2010 to 5 September 2013 (but as the scheme didnt actually start until 6 September 2010, you can only deduct employer NICs due on earnings paid on or after that date and before 5 September 2013.
Type of Business: a sole trader, company or partnership that begins to carry on a trade, profession or vocation; a property business or investment business; a new trading charity. Managed Service Companies do not qualify for the holiday. (IR35 employers who qualify will not be eligible for the holiday on income deemed to be earnings or employment resulting from the IR35 rules.) You must ensure that your type of business is not specifically excluded: HMRC NICs holiday exclusion list. http://www.hmrc.gov.uk/paye/intro/nics-holiday/eligibility.htm#6)
Business Location: These are the qualifying areas or regions - Northern Ireland, Scotland, Wales, East Midlands, North East, North West, South West, West Midlands, Yorkshire and Humber - if you are unsure check HMRC NICs holiday qualifying regions. (http://www.hmrc.gov.uk/thelibrary/tax-paye/nics-holiday/regions.htm)
If you are eligible then the HMRC explanatory guide will take you through the process of applying for your NIC holiday. (http://www.hmrc.gov.uk/paye/intro/nics-holiday/how-to-apply.htm)
For more information or assistance about any aspect of company payroll and PAYE, please contact linda@fergusneilson.co.uk or call Fergus Neilson Payroll Experts on 01865 989714.
Fergus Neilson Payroll Experts
http://www.fergusneilson.co.uk
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