Are you claiming your £4,000 National Insurance Allowance?

All employers pay National Insurance (NI) alongside all of their employees.  The NI contribution for the employee and the employer are dependent on the employees’ earning and what band they fall within. 

HMRC offer an employers’ National Insurance allowance for all businesses.

Who is eligible for the National Insurance Allowance?  

Businesses that can claim the employers’ Class 1 National Insurance Allowance are those whose NI liabilities were less than £100,000 in the previous tax year, or if they are a  Charity (including community amateur sports clubs or you employ care or support workers).

You are unable to claim if you’re a company with only one employee paid above the Class 1 National Insurance Secondary Threshold (£8,840 for the 2021/22 tax year, up from £8,788 for the 2020/21 tax year) if that employee is also a director of the company.

Further guidance can be found on the HMRC Website, Click Here

Eligible businesses can claim up to the £4000 tax limit every tax year.

For example: F/T employee earns £22,000, this employee will incur £151.34 NI per month or £1,816.08 per annum. This means that the employer will not pay any NI as this falls under the NI allowance for businesses.

As soon as you have an employee that tips over this threshold, for example NI is £4,250 the employer will be expected to pay the £250.

This allowance is dependent on the individual business, not by the number of employees, so you could have two employees both on £22,000pa as per the original example and still be under the threshold.

How do I claim National Insurance Allowance? 

This can be done through your payroll software or the HMRC’s basic PAYE Tool

When do I claim this National Insurance Allowance?

You will need to claim this every tax year, so make sure to claim early to ensure you receive your allowance.

If you would like any further advise on this, please do speak with your local BK Plus advisor or email us at hello@cooperfieldsd2.sg-host.com

Are you Eligible for a Restart Grant?

On 29th March 2021 the Government announced the launch of The Restart Grant scheme that supports businesses in the non-essential retail, hospitality, leisure, personal care and accommodation sectors with a one-off grant, to reopen safely now that COVID-19 restrictions are starting to be lifted.

There are still many businesses that do not realise that they are able to apply for this grant, which is intended to help businesses that are reliant on delivering in-person services to the public to be able to re-open safely as set out in Boris Johnson’s roadmap on 12 April 2021.

There are one-off grants available for businesses to apply for up to £6,000 for non-essential retailers and up to £18,000 for hospitality, accommodation, leisure, personal care and gyms which will allow them to re-open.

You must apply for these through your local council.

Eligibility

Your business may be eligible if it is:

  • Based in England
  • Rate-paying
  • In the non-essential retail, hospitality, accommodation, leisure, personal care or gym sectors
  • Trading on 1 April 2021

Businesses excluded from the fund;

You cannot get funding if your business:

  • Is in administration, insolvent or has been struck off the Companies House register
  • Has exceeded the permitted subsidy allowance

 

Further information can be found on the Government Website Click Here

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Capital Gains Tax

It is expected that he will announce the reform of capital gain tax (CGT) which we expected during the Autumn Statement in 2020 that was cancelled.  The new rules could be in place by the 6th April.  Entrepreneurs are worried that the CGT rates could be aligned much more closely with the income tax system.  Currently, most taxpayers pay CGT at a rate of 20%, falling to 10% for basic-rate taxpayers. By contrast, higher- and additional-rate taxpayers pay 40% and 45% respectively on their incomes. Increasing CGT accordingly – and perhaps introducing a new additional rate

There is also the possibility that The Chancellor could abolish Entrepreneurs Relief that allows business owners reduced CGT of 10% o the first £1m of capital gains they make when selling their business.