From April 2020, the Employment Allowance is to be restricted to employers who have a secondary NIC liability of less than £100,000 in the preceding tax year.
Following the restriction HMRC now view the Employment Allowance as de minimis state aid so will need to monitor how much is claimed up to the maximum £3,000 per tax year. They will also ensure employers do not exceed the maximum amount that they are allowed to claim over a period of three years.
During the course of normal payroll processing the employer will need to submit on the EPS (Employer Payment Summary) new information to determine if the allowance can be claimed.
From 2020-21 an existing Employment Allowance claim will not be rolled forward from the previous year and will require the employer to make a fresh claim each year.