Employment Allowance

[YorkshireMartin]

I'm always a bit behind the curve when it comes to accounting matters but I've just found out that the government sneaked in a change in April which prevented companies where there is one employee, who is also the director, from claiming EA.

So that little nugget has cost me £2k a year as I'm now the only person on the books at my firm.

Anyone else in the same boat? I'm guessing some of you are sole director ltd company based?

Think it might be time to revert back to being a sole trader after almost 20 years.

 

[finneyb]

Is EA available to sole traders? It will all dependent on NI contribution they make, if my memory serves, but things may have changed.

 

[YorkshireMartin]

Is EA available to sole traders? It will all dependent on NI contribution they make, if my memory serves, but things may have changed.

Yes I believe so, as long as they employ someone in addition to themselves and operate PAYE.

 

[YorkshireMartin]

Is EA available to sole traders? It will all dependent on NI contribution they make, if my memory serves, but things may have changed.

https://www.gov.uk/claim-employment-allowance

 

[Inoffthered]

Employ your missus and pay her.

 

[YorkshireMartin]

Employ your missus and pay her.

Would do but she has her own company and the income tax amount would be greater than the savings. Thought about putting someone else on but you have to pay above the threshold so just not really practical. Unless they'd accept my son...he's almost 2. lol

 

[whiskywill]

Is EA available to sole traders? It will all dependent on NI contribution they make, if my memory serves, but things may have changed.

Yes I believe so, as long as they employ someone in addition to themselves and operate PAYE.

I'm confused. How can you be a sole trader and employ somebody?

 

[Inoffthered]

I'm confused. How can you be a sole trader and employ somebody?

Sole trader refers to the ownership of an unincorporated business. (if there were two or more owners it would be a partnership)
Many sole traders employ people and they can set up a paye scheme for them.