Employment Allowance policy think tank

26 July 2019

Further to the technical consultation published last month on reforming the eligibility rules for the Employment Allowance, the CIPP are holding a think tank on Friday 9 August to discuss the implications and guidance needed to deliver the regulations.

 

De minimis State Aid

As part of the restriction of eligibility for Employment Allowance (EA) from April 2020 (it will only be available to employers with a secondary NICs liability below £100K in the previous tax year), EA will be reclassified as State Aid.

 

Employers will need to ensure that any EA claimed does not take them over the State Aid limit for the sector in which they operate.  The State Aid sectors are:

 

  • Agriculture

  • Fisheries and aquaculture

  • Road haulage

  • Other (industry)

It is unlikely that the payroll function will currently be involved to any extent (if at all) but we recommend that you talk to colleagues within your organisation who are responsible for accounting for government funding that constitutes de minimis State Aid.  The think tank will provide members with an opportunity to share views and experiences of claiming and reconciling State Aid within your organisations.

 

Reporting

The draft regulations (The Employment Allowance (Excluded Persons) Regulations 2019), as written, will bring about significant reporting and administrative challenges to payroll processes for employers reporting via RTI who will continue to claim the Employment Allowance from April 2020. The sharing of your experience within the think tank will be invaluable to ensure that this proposal develops appropriately.

 

Employers will need to report the following details through RTI on the Employer Payment Summary (EPS):

 

  • Employment Allowance Indicator (already present on the EPS)

  • The State Aid sector in which they operate

  • The amount of State Aid allocated in the current tax year, plus the amount of State Aid claimed in the previous two tax years. The value is to be expressed in Euros, using an exchange rate published by HMRC on 1 April

The declaration will no longer be able to be carried over – by virtue of the £100k secondary NICs exclusion level – this question will need to be considered and declared, each tax year.

 

Think Tank

As with previous think tank events the format will seek to provide the maximum opportunity for open and free-flowing discussion and debate with a focus on what is relevant and impactful to payroll processes and payroll software.

 

Invitations to the think will be distributed shortly to full, fellow and Chartered members. To secure your place, please email us by no later than noon on Monday 5 August 2019.

 

Think tank lead:

Samantha Mann MAAT, MCIPP Dip. Senior policy and research officer, CIPP

 

Date and time:

Friday 9 August 2019 from 11:00 to 14:30

 

Host:

Armstrong Watson

 

Venue:

15 Victoria Place

Carlisle

Cumbria

CA1 1EW