Employment Allowance restriction

From 6 April 2016, limited companies where the sole director is the only employee paid earnings above the Secondary Threshold (ST) for Class 1 NICs of £156 a week, are no longer able to claim the Employment Allowance of up to £3,000.

The company is no longer eligible for the allowance if:

  • only one employee (or director) in the limited company is paid above the ST
  • That employee is a director of the limited company.

Companies with several employees, where the director is the only employee paid above the ST, are no longer eligible for the Employment Allowance.

 

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