National Insurance ‘Holiday’ Unsuccessful

Prime Minister David Cameron has conceded that the Regional Employer NICs Holiday for New Businesses scheme announced in the Government’s June 2010 Budget, has not had the expected take-up.  This scheme, available for the qualifying period 22 June 2010 to 05 September 2013 gives a Secondary NICs ‘holiday’ to new businesses which are set up in this time.  However, this holiday only applies to Secondary Contributions payable on earnings paid on, or after, 06 September 2010.

The scheme was intended to support 800,000 new jobs, however, has only supported just over 12,000 to date.  Speaking to an audience of small businesses and entrepreneurs at Intuit UK in Maidenhead, Berkshire, Mr Cameron said about the scheme:

‘It wasn’t as successful as we had hoped.  I think it was too complicated, too targeted at specific businesses in specific areas of the country’

Comment

Given that the NICs Holiday scheme has a maximum saving of £5,000 for the first 10 ‘qualifying employees’ in a qualifying region, Mr Cameron was correct in that it is complicated!  More information about the Scheme below if anyone is not aware.

Further Information

HMRC  – Technical Note, Draft Legislation and Explanatory Notes