The ‘Regional Employer NICs Holiday for New Businesses’ offers substantial reductions in employer NICs for new businesses in those parts of the UK most reliant on public sector employment.
Under the three-year scheme, eligible businesses will be able to take a ‘holiday’ for each of the first 10 employees they hire in their first year of business. Each holiday will last for the first 52 weeks the employee is in post (providing these weeks fall within the three-year holiday period).
New businesses who take advantage of the scheme will be able to save up to £50,000 in employer NICs – £5,000 per employee, up to a maximum of 10 new employees.
Within the UK, the regions and countries that will benefit are the North East, Yorkshire and the Humber, the North West, the East Midlands, the West Midlands, the South West, Scotland, Wales and Northern Ireland.
The scheme is open to new businesses set up on or after 22 June 2010, and will run until 5 September 2013.
Launching the scheme, Exchequer Secretary to the Treasury, David Gauke, said:
“We need to rebalance our economy, which has become over reliant on public spending and jobs provided by the public sector.
“The NICs holiday for new businesses, in addition to cuts in corporation tax, will help provide a valuable boost to start up businesses, and help foster the private sector led recovery that will drive growth in the UK over the coming years.”
To find out if they are eligible for the holiday, and for further information on the scheme, new businesses should visit www.businesslink.gov.uk/nicsholiday and read the guidance. Eligible businesses should then make their application as outlined in the guidance.
Notes to editors
1. The Regional Employer NICs Holiday for New Businesses was announced by the Chancellor at the June 2010 Budget.
2. Employers will be able to make holiday deductions each time they are due to make monthly or quarterly payments to HMRC.
3. Most kinds of new business will be eligible for the holiday, provided they employ staff and meet certain criteria, which is set out in the guidance to be found by visiting www.businesslink.gov.uk/nicsholiday.
4. Most employees will be within the scope of the proposed scheme, with some limited exceptions eg. employees engaged through Managed Service Companies.
5. There are a small number of businesses who will be required to apply using a paper application form – full details are set out in the guidance.
6. Businesslink.gov.uk is the official government website for businesses of all sizes. It provides people with easy access to authoritative information, transactions and support to help them conduct their dealings with government and to find the information they need.