Employers’ NICs relief for employees working in Freeport tax areas

The government has announced a new zero rate of secondary Class 1 National Insurance contributions (NICs) for eligible employers on the earnings of eligible employees working in a Freeport tax site.

In Great Britain (England, Scotland and Wales), this measure will provide those employers with physical premises in a Freeport tax site (Freeport employers) with a zero rate of secondary Class 1 NICs on the earnings of new employees who spend 60% or more of their working time within Freeport tax site. This rate can be applied on the earnings of all new hires up to £25,000 per annum from 6 April 2022 for 36 months per employee. Legislation to introduce the relief is included in the National Insurance Contributions Bill 2021.

This measure is in addition to the tax breaks and Customs Duty exemptions announced in the March Budget for businesses operating in these designated areas.

The first 8 Freeports announced in the Budget are located at East Midlands Airport, Felixstowe & Harwich, Humber, Liverpool City Region, Plymouth and South Devon, Solent, Teesside and Thames.

For more information, visit: Zero-rate of secondary NICs for Freeport employees – GOV.UK

Contact your usual Beavis Morgan Partner for further information about how we can assist you and your business. Our experts are available to guide you through the tax maze and help you with bespoke solutions to ensure that you and your business are as tax efficient as possible.