The scheme, which will run for three years, makes new regional businesses exempt from paying up to £5000 in NICs for up to the first ten employees they hire in the first year of business.
The Treasury said the NICs holiday would give maximum savings on firms’ national insurance payments of up to £50,000 and estimated that 400,000 new businesses will benefit from lower tax bills.
Businesses set up since the emergency Budget on 22 June 2010 that meet the qualifying criteria will also be eligible to apply.
The aim of the government’s NICs holiday is to encourage the creation of private sector jobs in regions reliant on public sector roles.
Exchequer Secretary to the Treasury David Gauke: “We need to rebalance our economy which has become over reliant on public spending and jobs provided by the public sector.
“The NICs holiday for new businesses in addition to cuts in corporation tax will provide a valuable boost to start up businesses and help foster the private sector led recovery that will drive growth in the UK over the coming years.”
