Budget 2016: loss of NICs employment allowance for employers of illegal workers

Since April 2014, nearly all employers that pay Class 1 National Insurance contributions on their employees’ and directors’ earnings have been entitled to an Employment Allowance that can cut up to £2,000 a year off their National Insurance bill.

This includes:

  • Businesses
  • Charities (including community amateur sports clubs)
  • Those who employ a care or support worker

Following the 2016 Budget on 16th March, employers will be denied the national insurance contributions (NICs) employment allowance for a period of one year if they are subject to a civil penalty for employing illegal workers.

This measure will be introduced by regulations and will apply from the tax year 2017 to 2018. Exclusions will come into force from 2018 to 2019.

In effect, this increases the penalties for not ensuring all workers have the right to work in the UK.

You can download the 2016 Budget in full here.

And find out more about claiming Employment Allowance here.

Need advice? Get in touch today

Please call Ted Flanagan on 01482 324252.

Or email eff@gosschalks.co.uk.

Click here to find out more about our Employment Law services.

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