Employment Allowance

Summary

Information on Employment Allowance in Sage 50 Payroll, including an overview, eligibility, and submitting your application.

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.

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.

The Employment Allowance checkbox in your company settings is only available to select after you submit your application to HMRC.

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.

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.

When you're ready to apply, follow our article to apply for and enable Employment Allowance.

Recorded on 1 April 2026

Watch our Employment allowance webinar on how to check your eligibility and submit your claim.

Duration - 33 mins

Find useful information and the answers to a range of common questions in our Employment Allowance FAQ article.

Upgrade your licence

Growing business? Add more companies, users, or employees to your licence with ease. Leave your details and we’ll be in touch.