With the aim of encouraging youth employment and boosting economic development, changes to National Insurance Contributions have been announced by the Government.
Companies no longer have to pay employer National Insurance Contributions due on earnings up to the upper earnings limit for employees under the age of 21. It was initially announced in the 2013 Autumn Statement and it came into effect from April 2015. The relief applies to both employers taking on new staff and existing employees, and the Government have ensured that there will be no change to an individual’s state pension entitlement as a result of the new tax regime.
It is estimated that employers will save more than £500 for every under 21 year old earning £12,000, and it’s anticipated that around 1.5 million people under 21 will no longer attract employer National insurance contributions, saving companies around £355 per employee.
More details and National Insurance tables can be found on https://www.gov.uk/browse/tax/national-insurance
