Many small businesses, whether incorporated or not, pay family members for working for the business. However, as a recent case shows, it is easy to make mistakes which can prove costly.
MORE TAX The tax and NI treatment of termination payments currently depend on whether or not they are classed as earnings. This has often not been clear cut and factors such as whether the payments were provided for contractual reasons have had to be considered. For instance, the treatment of payments in lieu of notice […]
Change is on the horizon – from April next year, the self-employed will only pay one Class of National Insurance rather than the two currently payable. Current position Depending on the level of their profits, the self-employed may currently be liable for two Classes of National Insurance contribution – Class 2 and Class 4.
The National Insurance employment allowance can reduce an employer’s National Insurance bill by up to £3,000 – but not all businesses can benefit. Nature of the allowance Where available, the allowance is set against the employer’s secondary Class 1 National Insurance bill. The allowance, set at £3,000, reduces the National Insurance payable by the employer […]