NIC tax holiday set to launch

The government is preparing to launch its promised national insurance contribution holiday for start-up firms in certain areas of the UK.

The putative date for the launch is 6 September, although it is understood that every detail of the necessary legislation has yet to be confirmed.

Under the scheme, which is designed to help fledgling firms in regions that are economically hard pressed, new employers will not have to pay the first £5,000 of class 1 employer NICs due in the first twelve months of business.

This will apply for each of the first 10 employees hired in the first year of trading.

The scheme is due to run for three years, and firms that have set up since 22 June, when the measure was announced in the Budget, can claim for the tax breaks provided they meet the qualifying criteria.

The countries and regions which will benefit will be Scotland, Wales, Northern Ireland, the North East, Yorkshire and the Humber, the North West, the East Midlands, the West Midlands and the South West.

However, firms based in Greater London, the South East of England and the Eastern regions will be exempt from the relief. As will certain sectors such as agriculture, fishing and coal.