DANSP25975 - Employment Allowance

Section 8(1) (ea) of the Social Security Contributions (Transfer of Functions, etc.) Act 1999 (The Transfer Act)

Section 1 of the National Insurance Contributions Act 2014 allows employers to claim a deduction from their Class 1 secondary National Insurance contributions (NICs). This deduction is known as the Employment Allowance and is intended to reduce the overall NICs liability for eligible employers.

Entitlement decisions

Section 8(1) (ea) of The Transfer Act allows an officer of the Board to make a decision as to:

  • whether a person is or was entitled to the Employment Allowance and if so the amount the person was entitled to
  • whether a person is or was entitled to a repayment of the Employment Allowance and if so the amount the person was entitled to.

Such decisions may be required where:

  • a person considers that they are entitled to the Employment Allowance but HMRC considers that they are not
  • HMRC discovers that a person is claiming the Employment Allowance in circumstances in which they should not

This could be for a number of reasons, for example, because:

  • one of the exceptions applies in section 2 of the National insurance Contributions Act 2014
  • more than one company or charity within a group of connected companies or charities is claiming the Employment Allowance
  • more than the permitted amount is being claimed, for example, because a person is claiming the Employment Allowance on more than one of their PAYE scheme references.
Wording of decisions

For the wording of such decisions, see DANSP35410.