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July 12, 2013
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Regional Employers NI Holiday - Still Time to Apply & Backdate Claims

Overview

Businesses that commenced after 22 June 2010 based in 'qualifying regional areas' may be eligible for an Employers National Insurance Holiday for up to 12 months.

The qualifying regional areas include Yorkshire and Humber, North West, North East, West Midlands, East Midlands, South West, Scotland, Northern Ireland and Wales.

The Employers National Insurance Holiday is available to relieve employers NI contributions on the salaries of the first 10 employees starting in the first year of business, but finishing on 5 September 2013 if this is earlier.

Refunds for Backdated Claims

Many new businesses are unaware that the Employers National Insurance Holiday could apply and so have not yet made a claim.

However for such businesses is it possible to backdate the claim and obtain a refund of employers NICs previously paid - which could provide a valuable cash boost for a new business.

Common Areas of Difficulty

In deciding whether a business qualifies for the Employers National Insurance Holiday common difficulties include issues such as:

  • Is the business a new business?

In many cases the answer is obvious but sometimes the position may not be clear, for example where there has been a partnership split or an employee leaving their employer's business but taking clients with them.

In such cases it will be necessary to carefully examine the facts to determine if the business qualifies. It may also be advisable to make a disclosure to HMRC to protect against penalties if the relief is claimed but later challenged by HMRC.

  • Is the business located in a regional area?

Again in most cases the answer will be obvious but businesses that trade from multiple locations, are internet based or involve driving from customer to customer may require a more detailed analysis.

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