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HMRC internal manual

Statutory Payments Manual

Paying and Recovering - SMP/SAP/SPP/ShPP: Small Employer’s Relief (SER) annual threshold

The current threshold is £45,000.

The amount the employer can get back normally depends on the total gross, employer’s plus employee’s, Class 1 NICs in the last complete tax year before the employee’s Qualifying Week (QW). If the annual liability for Class 1 NICs is £45,000 or less the employer is entitled to:

  • 100% of the SP, and
  • an additional amount as compensation for the NICs they pay on the SP.

The compensation rate for 2016-17 is 3%.

All payments of SMP/SAP/SPP/ShPP made in the same tax months the employer is entitled to recover should be added together and then they should calculate 100% plus the compensation rate due for the tax year, of that total figure.