Employers will be aware that under the Job Retention scheme, a claim can be made for the Employers National Insurance related to furloughed pay. HMRC have issued guidance on how this interacts with the Employment Allowance which goes up to £4000 from 6 April 2020.
HMRC says:
“In calculating the total employer National Insurance contributions paid in any pay period, the employer should subtract any employment allowance used in that pay period. If you have not, or do not expect to pay any employer national insurance contributions in a pay period as a result of the employment allowance, you should not claim any employer national insurance contributions costs for furloughed employees in that pay period. If you expect to exhaust any employment allowance in a pay period then you should claim the lower of the employer national insurance contributions grant calculation, and the employer national insurance contributions costs that you paid,or expect to pay across your entire payroll.”
If you are caught by this, it may be wiser not to claim employment allowance until later in the tax year. Remember in any case you now have to claim employment allowance, it is not automatic.
