1.25 million businesses will be entitled to £2000 off their tax bill as of 6 April this year.
HMRC today announced a more detailed explanation of the new Employment Allowance, which was first unveiled by the government in the 2013 budget.
A total of £5.5 billion in savings will be made and 90% of those businesses benefiting will be SMEs.
Chancellor George Osbourne said:
“The Employment Allowance will boost businesses up and down the country and allow them to retain extra cash which they can use to invest in their business and take on more staff.”
You will be able to claim the Employment Allowance if you are a business or charity – including Community Amateur Sports Clubs – that pays Class 1 national insurance on your employees’ or directors’ earnings.
You will not be able to claim the allowance if you hire someone for personal or household work or if your business performs a public function, such as GP and prison services.
The hope is that these savings will encourage SMEs to employ more staff, providing a much-needed boost to the jobs market.
Click here for more information on whether you will be entitled.