Research and analysis

Employer National Insurance contributions reliefs for apprentices under 25 and employees under 21

This research explores the impact of employer NICs reliefs and whether they have increased the hiring of young people and apprentices.


Employer NICs Reliefs U21 Apprentices U25

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From April 2015, employers were no longer required to pay Class I secondary National Insurance contributions (NICs) on earnings up to a certain limit for employees under 21. In April 2016, an additional relief was introduced, abolishing NICs for employers of apprentices under 25. The policy was designed to support and encourage youth employment.

The research gathered feedback from businesses that have claimed NICs reliefs, and a few of those that are eligible but not claiming. It aimed to understand the impact of the reliefs and whether they have increased the hiring of young people and/or apprentices.

The research comprised of:

  • 10 qualitative phone interviews with non-claimants – businesses that had eligible employees, but did not claim for them
  • a national phone survey of 907 businesses in the UK, sampled from HMRC administrative data
  • 25 qualitative follow-up interviews with claimants

The findings of this report cover:

  • the impact of NICs reliefs and, specifically, whether they have encouraged employers to hire more young people and/or apprentices
  • how well employers understand how the reliefs work
  • employers’ experience of applying the reliefs
  • barriers to claiming the reliefs for those that do not do so
Published 13 December 2018