Job-sharing employees can save you money
June 21st, 2010
If you are recruiting to fill a vacancy or creating a new job, it may be cheaper for you to employ two part-time members of staff rather than one. This is because the NI threshold of £5,720 applies to the individuals and not the job.
If both are paid say £6,500, the amount on which employer’s NI is charged is £780 x 2, ie £1,560. At 12.3%, the NI payable will be £192. If, however, you pay one individual £13,000 to do the same job, employer’s NI will be charged on £7,280, so you will be paying £895 in NI. There is therefore a saving of £703 per annum at current rates of Employer’s NI.
Using childcare vouchers, to a maximum of £55 per week, is also tax effective as they are not subject to Employer’s NI.
The savings need to be weighed up against costs of training two employees instead of one etc.
The content of this article is for general information only. It should not be relied on and action which could affect your business or personal circumstances should not be taken without appropriate professional advice.
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