Save up to £2,000 in tax!

- Monday, April 28, 2014

Save up to £2,000 in tax!As of April 2014 if you run a payroll you will be able to save up to £2,000 in employer National Insurance Contributions if you qualify and apply for it.

Well worth investigating

The allowance will be administered through the PAYE system via HMRC’s Real Time Information (RTI) from 6th April 2014. It works by crediting the Employer NI due and will carry on each month until the £2,000 allowance is reached.

Example: if the April 2014 Company payroll has an Employer NI liability of £500 then this will be credited in the April payroll and the HMRC liability will be £500 less than normal. £1,500 NIC allowance will be carried forward to May 2014 payroll to be used until no allowance is left.

The allowance is only available to one company if there are a number of connected companies and you will need to decide which PAYE scheme to claim it against.

If you are a director owner of a company you potentially will not use up the full £2,000 employer NIC allowance on employee pay or you may not have any employees. If this is the case then your salary should reflect the most tax efficient amount taking advantage of some of the allowance.

If you require any further advice please contact me.