Readers’ forum: NICs where there is more than one employee

I am aware that the employment allowance cannot be claimed by single-director companies. But I am confused about the position where the company has a second employee. HMRC says that there must be a secondary National Insurance contributions (NIC) liability in respect of that second employee at some point in the tax year. But I have seen commentators suggest that all that is necessary is that there is a second employee and that an NIC liability is not necessary.

I’m interested in readers’ view on the correct interpretation of the legislation but would especially like to hear of cases where a claim for employment allowance has been accepted by HMRC in cases where there is no NIC liability on the second employee’s earnings.

Query 20 267– Hopeful.

Second employee must be paid above the class 1 NI secondary threshold.

The rules relating to employment allowance are not straightforward and...