Who is likely to be affected?
Employers with employees under the age of 21.
From 6 April 2015 every employer with employees under the age of 21 will no longer be required to pay Class 1 secondary National Insurance contributions (NICs) on earnings up to the upper earning limit (UEL), for those employees. The removal of the requirement for employers to pay Class 1 secondary NICs aims to encourage them to employ individuals under the age of 21. This measure will take effect from 6 April 2015.
Under proposals and subject to earnings up to the UEL, employers who employ or engage employees under the age of 21 at or after 6 April 2015 will not be required to pay employer NICs on the earnings they pay to those employees. The UEL in 2015-16 is expected to be £813 per week (annual equivalent £42,285).