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News - 14 October 2013

Boost for business with the introduction of the National Insurance Contributions Bill.

Businesses and charities are to benefit from an annual £2,000 employment allowance towards their national insurance contributions. The allowance is part of the National Insurance Contributions Bill that was introduced to Parliament last week. The allowance is expected to be in place by April 2014. To receive the allowance employers will need to confirm their eligibility via the normal payroll process. The allowance will be deducted over a year from employers' PAYE payments.

Tonmoy Kumar, Manager of the Accounts Department of ABDS comments:
“The legislation will benefit up to 1.25 million businesses, this action taken by the government will result in around 450,000 businesses – or one third of all employers – being taken out of paying National Insurance Contributions altogether. The Employment Allowance will be of greater benefit to small businesses, as it will reduce their National Insurance Contributions bill the most. Over 90% of the benefit of this allowance will go to small businesses with fewer than 50 employees.”

This will mean that businesses will be able to employ four adults or ten 18-20 year-olds full-time on the National Minimum Wage without paying any employer National Insurance contributions at all.

Businesses, charities and Community Amateur Sports Clubs will be eligible for the new Employment Allowance. Up to 35,000 charities with employees are expected to benefit from the Employment Allowance, by around £45 million a year in total.

If you need any help and advice with Charities and sports clubs or with PAYE Real Time Information, contact Lavinia Newman or Peter Ham now to discuss how ABDS can help bring their experience to these matters.

ABDS Chartered Certified Accountants of Southampton.
Tel: 023 8083 6900  E-mail:

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