Employer's National Insurance

Employer (secondary) National Insurance contributions on employees' wages are an allowable business cost. From 6 April 2025, the employer NIC rate is 15% on earnings above the secondary threshold of £5,000 per year. The Employment Allowance of £10,500 per year reduces the bill for eligible employers.

Recruitment & agency fees

The costs of recruiting staff — job advertising, job board listings, and recruitment agency placement fees — are allowable revenue costs. They are ordinary running costs of building a workforce, not capital expenditure.

Staff salaries & wages

Wages, salaries, and bonuses paid to employees are allowable business costs. The payment must have been actually made, run through PAYE, and be commercially justifiable — salaries paid to family members or connected persons must reflect the market value of the work genuinely done.

Staff training

The cost of work-related training provided to employees is an allowable expense for the employer, and it is exempt from being a taxable benefit in kind for the employee under s250 ITEPA 2003. This entry covers training provided to employees of the business — for the business owner's own training and continuing professional development, see the training-courses entry.

Subcontractor & freelancer costs

Payments to genuine subcontractors and freelancers for business work are an allowable cost. The key conditions are that the worker must be genuinely self-employed (not a disguised employee), and in construction, the Construction Industry Scheme (CIS) deduction rules must be followed.

Staff Costs

Employer's National Insurance

Recruitment & agency fees

Staff salaries & wages

Staff training

Subcontractor & freelancer costs

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