A quick reminder of what is coming up.

For paydays on and after 6 April 2025:

• the rate of secondary NIC paid by employers on an employee’s earnings above the secondary threshold will increase from 13.8% to 15%; and
• the secondary threshold will reduce from £9,100 to £5,000 per annum.

You will need to consider how you deal with this increased cost, pass it or absorb it.

Attention should be paid to any NIC exemptions that are available. For example, there are higher secondary thresholds for some categories of employees, all depending on their circumstances on payday, one example being veterans.

The reduction in the secondary threshold means employers will have an obligation to send the full payment submission (FPS) for employees earning above this threshold (£96 per week/£417 per month). Previously the obligation applied where earnings were above the lower earnings limit.

For 2025/26 onwards:

• the annual value of the employment allowance is increased from £5,000 to £10,500;
• the £100,000 NIC eligibility threshold is removed; and
• state aid restrictions are removed.

The £100,000 eligibility limitation has been applied since 6 April 2020 and restricts an employer claiming if employer class 1 NIC exceeded this in the tax year immediately prior to the claim. More employers can now claim the employment allowance.

It is possible to backdate employment allowance claims for the previous four tax years. So, when thinking about eligibility for 2025/26, also consider if the employment allowance could have been claimed for an earlier year.