A new National Insurance Contributions (NICs) holiday for employers who hire former members of Her Majesty’s regular armed forces came into force on 6 April 2021. The policy delivers on the government’s manifesto commitment to introduce this change.

The change will enable employers to apply a zero-rate of secondary Class 1 Employer NICs on the earnings of veterans during the first year of their civilian employment post-service. The zero-rate will apply up to the Upper Secondary Threshold.

Employers will be able to claim this relief for the 12-month period starting on the first day of the veteran’s first civilian employment since leaving the regular armed forces.

From April 2021 to March 2022, employers will need to pay the associated secondary Class 1 NICs as normal and then claim it back retrospectively from April 2022 onwards. From April 2022, HMRC will put measures in place to enable employers to apply the relief through PAYE.

Source: New feed