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Since 6 April 2025, the Employment Allowance has increased from £5,000 to £10,500 and the previous Employment Allowance £100,000 eligibility threshold has been removed. This means all eligible businesses and charities will be able to claim a greater reduction on their secondary Class 1 NICs. We have recently received several queries from our Third Sector and Public Sector clients and so we wanted to clarify the position going forward. The changes to the restriction on larger businesses (with Class 1 NIC liabilities of over £100,000) claiming the employment allowance will not have an effect on organisations, unless they are also registered as charities. From 6 April 2025, any clients and organisations that are registered as charities will be eligible to claim the employment allowance. Public authorities are also not able to claim the employment allowance unless they are also a charity. For example, HMRC has provided guidance that shows that organisations such as non-charitable housing associations are treated as public authorities for these rules. Further details on eligibility can be found on the Gov.uk website, please click below:
Employment Allowance: Check if you’re eligible – GOV.UK
Eligibility for Employment Allowance: further employer guidance – GOV.UK
For further information, help with establishing if you are now eligible to claim the Employment Allowance, or to discuss any other employment tax matters, please get in touch.