National Insurance holiday for employers of Veterans

In April 2021, HMRC rolled out a scheme for employers of veterans to receive National Insurance relief. The scheme is designed to encourage employers to look again at the unique skills and experience that former members of the UK armed forces can bring to the workplace. This creates fresh opportunities and supports veterans in making the transition to civilian employment.

Since April 2021, employers taking advantage of the ‘National Insurance holiday for the employers of veterans’ have been able to apply a zero-rate of secondary National Insurance contributions (for that employee) for up to 12 months.

Employers will only be able to claim National Insurance contributions relief on the earnings of qualifying veterans. A person qualifies as a veteran if they have served at least one day in the regular armed forces. This includes anyone who has completed at least one day of basic training. The relief is available to all employers of veterans regardless of when the veteran left the regular armed forces, providing they have not previously been employed in a civilian capacity.

Relief will apply on earnings up to the upper secondary threshold. If a veteran’s earnings are above the threshold, employers can apply the relief on part of the earnings below the threshold. This approach is in line with existing reliefs for under 21s and under 25 apprentices.

Employers can claim relief if they employ a veteran during the qualifying period. The qualifying period starts on the first day of the veteran’s first civilian employment since leaving the regular armed forces and ends 12 months later. Employers can claim relief even if the employment started before 6 April 2021, but will only be able to claim for the remaining qualifying period.  The first day of employment will be the start date taken from the employment contract between the employer and the employee. This 12 month period does not change if the employment finishes. This means that current and future employers can also claim this relief if they employ a veteran within their qualifying period.

Subsequent employers must determine the first day of the veteran’s first civilian employment, and confirm that the veteran is employed with their business during the qualifying period. Employers can claim through Full Payment Submissions from April 2022, although retrospective claims for the period April 2021 to April 2022 can also be made. There is no limit to the number of qualifying veterans a single business can employ.

Full policy guidance and examples can be found at:

As with any payroll information, employers must keep records for at least 4 years. Details of the records to keep can also be found on the above link.