Employment Allowance can reduce a company’s employer National Insurance bill by up to £10,500 each year — a direct cash saving that many owner-managed businesses assume applies automatically but often doesn’t.
What you get
- Up to £10,500 off your employer's National Insurance Contributions (NIC) across the tax year.
- Once eligibility is confirmed, the allowance is applied automatically through payroll, reducing NIC costs month by month.
Who can claim – and who often cannot
Most businesses and some charities can claim the Employment Allowance. However, it is not available to single‑director companies where the director is the only employee, and no secondary Class 1 NIC is paid.
- At least one employee must earn above the Lower Earnings Limit (LEL) (£559 per month for 2026/27), creating an employer NIC liability.
- The employee can be part‑time or employed for only part of the year, provided the role is genuine and appropriately paid.
Practical example
Even employing someone for just one month in the tax year — for example, in a legitimate role supporting invoicing, deliveries or stock control — and paying them above the LEL, can enable a company to claim Employment Allowance for that year.
How we can help
Crowe will assess eligibility, confirm whether Employment Allowance applies and ensure it is correctly claimed through payroll so savings captured automatically as part of your monthly payroll if you qualify.
For more detailed advice, please get in touch with your usual Crowe contact.
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