Draft legislation: zero-rate secondary Class 1 contributions for veterans
Consultation description
This is a technical consultation on draft legislation that will mainly be of interest to employers, accountants and tax specialists.
These draft clauses will enable employers to apply a zero-rate of secondary Class 1 Employer National Insurance contributions (NICs) on the earnings of veterans during the first year of their civilian employment. It is intended this will provide employers with a relief worth up to £5,000 for each qualifying veteran they hire.
A veteran will qualify if they have completed at least one day of basic training in Her Majesty’s regular armed forces. Employers will be able to claim this relief for the 12-month period starting on the first day of the veteran’s first civilian employment since leaving the regular armed forces.
Subsequent and concurring employers will be able to claim the relief during this period. This zero-rate will apply up to the Upper Secondary Threshold.
Further detail on how employers will claim this relief will be published shortly.
A public consultation for this measure was held in Summer 2020, and a summary of responses has been published.
On this page, you can read:
- the draft legislation
- a technical overview of the legislation
This measure is intended to take effect from 6 April 2021.
You can read about National Insurance contributions relief for employers who hire veterans on GOV.UK.