In order to bolster employment for young people, it was announced in last year’s Autumn Statement that, with effect from 6 April 2015, NIC would not be charged on the earnings of under 21s up to the Upper Earnings Limit for NIC (which will be £815 per week for 2015/2016).
The existing rules draw no distinction between ordinary employees and apprentices.
In his speech, the Chancellor announced that the exemption from employer NIC would be extended to any person under the age of 25 who is engaged as an apprentice. The new rules will take effect from 6 April 2016.
The abolition of employer Class 1 NIC for young apprentices will significantly reduce the costs of employing them. The latest change represents an opportunity for employers to offer apprenticeships to more people while still enjoying the relief from employer’s NIC.