Summary
Description
Employment Allowance is an employer benefit that reduces your employer's NI liability. The allowance remains at £10,500 per year for the 2026/2027 tax year.
With Employment Allowance, each time you run your payroll you pay less employer's Class 1 NI.
This continues until you've used the full allowance for the tax year or 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.
Claim the allowance in your software
The Employment Allowance checkbox in your company settings is only available to select after you submit your application to HMRC.
TIP:
After you apply, your software makes the Employment Allowance checkbox available for you to use automatically.
Continue to check you're eligible below for your next steps.
Check you're eligible
If you're not sure whether your business is eligible, go to Gov.UK to check HMRC's guidance.
Where you're already sure your business is eligible, continue to submit your application below.
Submit your application
When you're ready to apply, follow our article to apply for and enable Employment Allowance.
Further information
Find useful information and the answers to a range of common questions in our Employment Allowance FAQ article.
Make timesheets easy
The Sage HR timesheets module helps you pay your employees accurately, by making it easy to track their time at work. Click below to leave your details and find out more.
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