By Claire West
Today a new regional National Insurance Contributions (NICs) holiday for new businesses came into effect.
New business set up outside London, the South East and East of England will be eligible for a holiday worth up to £5,000 for up to the first ten employees they hire in their first year of business. This means a maximum saving on their national insurance payments of up to £50,000.
The scheme will run for three years. It is estimated that 400,000 new businesses will benefit by having a lower tax bill from employing new staff.
New businesses established since the announcement in the Budget on the 22nd June, and which meet the qualifying criteria, will also be eligible to apply.
The regional NICs holiday, announced in the June Budget, will encourage the creation of private sector jobs in regions reliant on public sector employment by reducing the cost to new business of employing staff.
Exchequer Secretary to the Treasury, David Gauke:
“We need to rebalance our economy which has become over reliant on public spending and jobs provided by the public sector.
“The NICs holiday for new businesses in addition to cuts in corporation tax will provide a valuable boost to start up businesses and help foster the private sector led recovery that will drive growth in the UK over the coming years”