The NIC holiday scheme that was officially introduced on 6 September 2010 ended on 5 September 2013. The scheme was designed to help new businesses in qualifying regional areas to create jobs by reducing the costs of employing staff. The scheme was only open to qualifying new businesses outside London and the South East and the take-up of the scheme had been far less than expected.

The scheme allowed for a deduction against the amount of Class 1 NICs that a qualifying employer was required to pay to HMRC each month or each quarter and applied to all relevant earnings paid to a qualifying employee during the first year of an employee’s employment or for the time left until the holiday scheme ended on 5 September 2013. A qualifying business was entitled to an exemption for up to a maximum of £5,000 of Class 1 employer NIC for each of the first ten qualifying employees.

All employer NICs due on earnings for periods after 5 September 2013 must be paid to HMRC in full. Employers that were entitled to a credit for employer NICs relating to earnings paid in the period 6 April 2013 to 5 September 2013 must submit the Employer NICs Holiday End of Year Return (E92 and E89(s)) by 19 May 2014. Employers that would have qualified for the NIC holiday scheme can apply retrospectively for the deduction.