The Chancellor of the Exchequer is predicted to announce further changes to the Employment Allowance.
A cut in the ‘job tax’. Raising the employment allowance from £3,000 to £4,000, giving millions of businesses an immediate boost.
In a government policy to encourage job creation, the employment allowance allows qualifying employers to offset currently up to £3,000 against their secondary NIC employer contributions.
Other reforms planned to be introduced 6th April 2020 see larger employers no longer qualifying, and a new reporting requirement to indicate relevant industry type to comply with De minimis state aid requirements.
Will this impact payroll? Certainly will, software will have readied for the new EPS filing requirement, however the rise of the allowance to £4,000 may take many by surprise! Software will have already been developed, tested, and delivered to employers.
The government have indicated that any income tax changes, if any, will not be implemented on 6th April 2020, but at a later point in time yet to be announced.