Employment Allowance & apprentice incentives 2026

The 2026 Budget will raise the Employment Allowance to £6,000 and boost apprenticeship grants for micro employers. If you’re hiring your first tech or apprentice, here’s how to capture every pound using Toolfy.

1. What’s new

• Employment Allowance: offset up to £6,000 of employer National Insurance contributions if your NI bill was under £150K last year.
• Apprenticeship incentive: £3,500 for 16–18-year-olds (up from £3,000) plus £1,500 for 19–21-year-olds in key trades.
• Claim timing: allowances apply per tax year; grants hit after the apprentice completes 90 days.

2. Toolfy checklist for claiming

1. Tag your new employee/apprentice job in Toolfy with “EA eligible” or “Apprentice FY26”.
2. Store offer letters, apprenticeship agreements, and college paperwork in Documents under /People/Name.
3. Add onboarding tasks reminding finance to submit the allowance through HMRC Basic PAYE Tools or your payroll software.

3. Payroll exports

• Use Toolfy’s payroll export (CSV) every month; share with your accountant to apply the NI offset.
• Highlight the apprentice’s wages and hours so the finance team can calculate grant milestones.
• Track total grant receipts with a Grant tag on invoices so you know when to reinvest in tools or training.

4. Communication templates

• Draft a short email to customers explaining you’re investing in apprentices (good PR and justification for minor price adjustments).
• Document the government logos or wording you can/can’t use when advertising the funding.

5. Timeline

| Date | Action | | --- | --- | | Before year-end | Confirm NI totals and eligibility; set reminder to claim EA on 6 April. | | April 2026 | File the EA claim in payroll software; reduce NI payments immediately. | | Month 1–3 of apprenticeship | Complete Toolfy onboarding tasks, ensure college attendance logs are uploaded. | | Day 90 | Submit incentive claim via Apprenticeship Service; log payment date in Toolfy. |

Need the onboarding checklist or payroll export template? Email support@toolfy.io and we’ll drop them into your workspace.