Employment Allowance Calculator
Check eligibility and calculate your £10,500 NI saving
Your total Class 1 employer NI
Excluding sole directors
What is the Employment Allowance?
The Employment Allowance is a scheme that allows eligible employers to reduce their annual Class 1 National Insurance liability by up to £10,500 (from April 2025). It's claimed through your payroll software.
Who is eligible for Employment Allowance?
Most employers with Class 1 NI liability can claim. Exceptions include: single-director companies with no other employees, employers with NI bills over £100,000 in the previous year, and public sector employers.
How do I claim Employment Allowance?
Claim through your payroll software by indicating you're eligible before your first EPS submission of the tax year. The allowance is then automatically offset against your employer NI bill each month until used up.
Can I backdate an Employment Allowance claim?
Yes, you can claim Employment Allowance for previous tax years (up to 4 years back) if you were eligible but didn't claim. Contact HMRC to make a retrospective claim.
Does the Employment Allowance affect individual employees?
No, Employment Allowance only reduces the employer's NI contributions. It doesn't affect employees' pay, tax, or NI deductions. It's purely a saving for the business.