National Insurance has undergone a plethora of changes in recent years that have kept employers on their toes.
Businesses that employ apprentices saw a change in the law back in April 2015 when the Government introduced a zero per cent rate of Secondary National Insurance Contributions (NIC) for employers. This applied to apprentices aged below 21 earning up to £815 a week.
As of 6 April 2016, the Government extended the rule to all apprentices under the age of 25 earning up to £827 per week. All income above this threshold is liable for Class 1 Secondary NICs.
By capturing more apprentices on the zero per cent NIC rate the Government hopes to support the growth of Apprenticeships and in turn, boost productivity and reduce skills shortages.
The revenue currently estimates that around 180,000 UK employers offer Apprenticeship programmes.
HMRC has issued guidance on how to check whether an apprentice qualifies for the zero per cent rate that can be found here: http://bit.ly/1SFRKAS
Evidence that an apprentice qualifies is required by HMRC by either a written agreement between the business, apprentice and training provider or a document which proves that the Apprenticeship receives Government funding.
If you employ apprentices or are thinking about implementing Apprenticeships within your business and want more information on how the changes affect you, then contact your local office.
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