If your agency has employees, do not miss the £10,500 National Insurance relief

If your marketing agency has employees, there is a National Insurance relief from HMRC worth up to £10,500 a year that a surprising number of agency owners have never claimed.

It is called Employment Allowance.

What Employment Allowance actually does

It allows eligible employers to reduce their employer's National Insurance bill by up to £10,500 per tax year.

This can be huge if your agency has staff on payroll. If you are paying employer's National Insurance each month, the allowance can reduce or even wipe out that bill until the £10,500 limit is used.

Note what it does not do. It reduces the employer's National Insurance your company pays. It does not touch the National Insurance or income tax your employees pay on their own wages, and it does not reduce your corporation tax bill directly, though a smaller National Insurance cost does mean a slightly higher taxable profit.

Who can claim it

You may be able to claim if:

1. You have employees on payroll

2. You have employer's Class 1 National Insurance to pay

3. Your company is not caught by the single-director restriction

4. You meet the wider eligibility rules

The trap that catches most agency owners

If you are a one-person company and the only employee is the sole director, you cannot claim.

This is the rule that quietly disqualifies a lot of founder-only agencies. HMRC's wording is that if your company has only one director, they must not be the only employee liable for secondary Class 1 National Insurance. So the moment you take on your first properly paid employee alongside yourself, the position can change, and it is worth checking again rather than assuming the answer is still no.

What to do about it

If your marketing agency has staff, check whether you are eligible, because this could save you thousands in employer's National Insurance.

It is claimed through your payroll software as part of your normal submissions rather than by writing to HMRC, so in practice this is a conversation with whoever runs your payroll. If you have had staff for a while and have never claimed, ask whether earlier years can still be picked up.

How you pay your team and how you pay yourself are two different questions, and the second one has its own answers: how much an agency founder should actually pay themselves covers the salary and dividend side. If you are looking for the wider set of moves available this tax year, three tax moves for agency owners in 2026/27 is the short list.

Figures and thresholds change, and eligibility turns on your own payroll facts, so treat this as general information rather than advice on your situation. If you want your payroll position checked properly, see how we work or talk to us.