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HMRC internal manual

National Insurance Manual

HM Revenue & Customs
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Employment Allowance: Connected persons – companies and Limited Liability Partnerships

National Insurance Contributions Act 2014 - Section 3 & Schedule 1


If, at the beginning of a tax year, two or more companies (which are not charities) are connected with one another, then only one of those companies may claim the Employment Allowance. It is up to those companies to decide which one will make the claim.

Two companies will be connected with one another if one of them has control over the other, or both are under the control of the same person (or persons). The rules for determining where this applies are contained at NIM06595 to NIM06615 inclusive.

For this purpose, “company” has the same meaning given by section 112(1) of the Corporation Tax Act 2010 and it includes Limited Liability Partnerships and “control” has the same meaning given by Part 10 of the Corporation Tax Act 2010 (see sections 450 and 451 of that Act).

Limited Liability Partnerships

For this purpose (of establishing entitlement to claim the Employment Allowance), where section 450 of the Corporation Tax at Act 2010 mentions a person (P) has control over a company (C), then whenever (C) is a Limited Liability Partnership, (P) will be treated as having control over (C) if (P) is entitled to acquire the rights to a share of more than half the assets, or more than half the income of (C).

Where section 451 of the Corporation Tax Act 2010 is applied for the purpose of determining entitlement to claim the Employment Allowance, any person to whom rights and duties fall to be attributed under subsections (4) and (5) of section 451 of that Act, is to be treated for the purposes of applying those subsections, as having no associates.