No Employers NICs for apprentices under 25

From 6th April 2016, the government have zero-rated the employer National Insurance for apprentices aged under 25. This is to encourage employers to employ more apprentices.

The employer must ensure the apprentice is in a statutory apprenticeship scheme. Via the website, there are a number of links the employer can use to check. Assuming the apprentice meets the conditions, the employer must also have evidence to obtain the relief which is a written agreement between the employer, the apprentice and the training provider or evidence that the apprenticeship is receiving government funding. The written agreement must detail a) the approved government apprentice framework or standard, and b) a start and expected end date for their apprenticeship scheme. The employer can be both employer and the training provider, as long as they have been approved by the Skills Funding Agency in England.

For payroll there will be a change of National Insurance category letter – H – apprentice standard rate contributions, aged under 25 and G – apprentices who are foreign-going mariner, aged under 25 years. There is already category M in place for anyone under 21 years of age in operation. There are no changes to employees’ National Insurance Contribution rates.

If you have any current employees that this new change may affect, you will need to provide evidence and inform your payroll provider.

Click here for more information on apprenticeships.

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Tania has over 30 years payroll experience, 21 with a UK Top 10 accountancy firm.

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