Draft legislation: zero-rate secondary Class 1 contributions for veterans

HMRC has published a consultation – closing 8 March 2021 – on draft clauses that will enable employers to apply a zero-rate secondary Class 1 Employer National Insurance contributions on the salaries of veterans during the first year of 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.