What is Employment Allowance? It's an employer benefit that reduces your employer's National Insurance liability. With Employment Allowance, each time you run your payroll you pay less employers’ Class 1 National Insurance. This continues until you've used the full allowance for the tax year or until the tax year ends, whichever is sooner. CAUTION: If you claim Employment Allowance, you must apply again at the start of each tax year. It doesn't carry over between tax years automatically.
2026/2027 tax year The allowance remains at £10,500 per year for the 2026/2027 tax year. To find out more about legislation for the 2026/2027 tax year, visit the payroll legislation for the 2026/2027 tax year article. State aid Employment allowance no longer counts as 'de minimis state aid'. This means HMRC don't require the information from the state aid options within the Employer Allowance application submission. As they're obsolete, we've removed these options as of v32.
Check you're eligible If you're not sure whether your business is eligible, go to Gov.UK to check HMRC's guidance. HMRC don't send confirmation letters for Employment Allowance. If they reject your claim, HMRC send an automated message within five working days.
Claim the allowance in your software
Is this the same as Small Employers' Relief (SER)? No, this benefit is different to SER, you could be eligible to claim this too. Visit our what is SER article if you'd like to find out more.
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