- The levy is based on earning subject to Class 1 secondary NICs – Wages, bonuses, commissions and pension contributions but not on benefits in kind.
- Every company in the UK will be paying the levy but depending on the total cost of the payroll some companies will be below the threshold for making a payment.
- Each firm will have an allowance that will allow them to reduce the amount of tax that will be required. This is similar to a personal allowance, each month a company will have 1/12 of the £15,000 to reduce the levy contribution by. If the levy contribution is lower than the allowance the unspent allowance rolls forward.
- If you have multiple PAYE schemes and do not use the full £15,000 you will be able to offset the unused amount against another one of the schemes once the tax year has ended.
- Payment will be made alongside the regular monthly PAYE by the 19th or 22nd if paid electronically.
- Where a group of companies are connected they will only be able to use one allowance.
- This is similar to the employment allowance definition – If a company has control of another company or both companies are under the control of the same person or persons.