NI holiday take-up below target despite recent rise

Date: 25th July 2011

The government has announced that too few small businesses are joining the National Insurance (NI) holiday scheme despite a recent increase in take-up numbers.

Although numbers have risen of late, levels are still falling short of the Treasury's original estimates, Accountancy Age explained.

It was thought that around 132,000 enterprises would sign up for the scheme, which allows firms to receive relief on NI contributions in the first 12 months of operation, but figures show that just 5,137 applications were granted between September 2010 and last month.

A further 163 applications were made but turned down by the Treasury.

David Gauke, exchequer secretary to the Treasury, said: "Earlier this year, HMRC commissioned some research into the initial operation of the scheme.

"This suggests that awareness among potentially eligible employers was lower than expected but the scheme has a positive influence on the prospects for taking on staff and the future growth of businesses for many of the businesses interviewed. Full results of the survey will be published shortly."

Posted by Jacob Williams