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From 6 January 2024, the main rate of class 1 National Insurance contributions (NIC) deducted from employees’ wages is reduced from 12% to 10%. From 6 April 2024, the main rate of self-employed class 4 NIC will reduce from 9% to 8% and class 2 NIC will no longer be due. Those with profits below £6,725 a year can continue to pay class 2 NIC to keep their entitlement to certain state benefits. Our guidance will be updated in full in spring 2024.

Updated on 6 April 2023

Employing a disabled person

You may be considering employing a disabled person for their abilities, skills or experience. On this page, we look at the support, tax-related and otherwise, that employers can access.

Content on this page:

Employing disabled staff: the law

Under the Equality Act 2010 no employer may treat less favourably a disabled person in terms of recruiting, training, promotion, dismissal or redundancy than any other person.

This may mean that in order to take on a disabled employee, or retain one who has become disabled whilst in work, you need to make reasonable adjustments to enable a disabled person to carry out a particular job, so that they are not disadvantaged.

In determining whether it is reasonable for an employer to take a particular step in order to meet the requirements of the Act, particular regard will be given to the extent to which it is practicable for the employer to take the steps, the extent of the employer's financial and other resources and so on.

A disabled person is legally defined as someone with a physical or mental impairment that has a substantial and long-term adverse effect on his/her ability to carry out normal day-to-day activities.

You can find guidance on the definition of disability under the Equality Act on GOV.UK.

Some examples of reasonable adjustments are:

  • altering the person's working hours,
  • allowing absences during working hours for medical treatment,
  • giving additional training,
  • getting special equipment or modifying existing equipment,
  • changing instructions or reference manuals.

Most adjustments are simple and low or no cost – such as raising or lowering pieces of furniture or allowing someone to use a car parking space. Not every disabled person needs sophisticated equipment or support, and if they do, the Access to Work scheme can help to fund this. There is more information on this scheme below.

The Equality and Human Rights Commission has provided examples of reasonable adjustments in practice.

Salary grants

We are not aware of any specific salary grants or subsidy programmes available to employers of disabled people, although Access to Work can give grants for extra costs (see below) and there may be general schemes available to help employers fund new jobs and with the costs of employing staff.

There is also the small employer National Insurance break of £5,000 which is widely available (this does not help employers with direct salary costs, but one of the more hidden costs of employing someone).

Note that it is not possible for employers to pay disabled people less than the minimum wage.

Access to Work for employers of disabled people

Access to Work is a specialist, government-financed disability programme. It covers England, Scotland and Wales and can give grants towards extra employment costs. A different system is run in Northern Ireland.

Access to Work can help fund things like the cost of specialist equipment and alterations to premises or a working environment to make it more accessible.

Although payments are often made to employers to help pay for support provided to the disabled employee, it is the employee who has to apply for the grant. You can therefore read about the scheme in more detail on our page for employees.

You can also find an Employer’s Guide to Access to Work Factsheet on GOV.UK.

Please note that the Equality Act 2010 places a duty on an employer to make reasonable adjustments for disabled employees. Access to Work funding cannot be used to support these adjustments.

Access to Work will also not fund items which are regarded as standard equipment, standard business costs or standard health and safety requirements. This means that any item which would normally be needed to do the job, whether a person is disabled or not, will not be paid for.

How the tax system supports employers of disabled people

Revenue or capital expenditure

The Equality Act (EA) 2010 requires employers to make reasonable adjustments to help any disabled employees and these can cover both changes to the workplace or employment arrangements.

The cost of making many of these adjustments would qualify for tax relief as a business expense either as a revenue expense, or through capital allowances.

Examples of revenue expenses include the cost of large print documents and training on disability issues. These are fully deductible for tax purposes. Examples of capital expenses include installation of ramps and handrails.

This guidance is equally relevant to the reasonable adjustments you would need to make under the EA 2010 where your business provides goods, services and facilities direct to disabled customers.

VAT

Please note that while VAT zero-rating is available for modifications to certain areas of the home for disabled people, no corresponding relief is available in UK VAT law in respect of workplace modifications undertaken by an employer. Although this may not be an issue for employers who are able to recover input tax in full, VAT costs could be incurred by those unable to do this, for example exempt or partly exempt employers.

Benefits in kind rules

If you provide equipment or services (for example, a hearing aid or wheelchair) to a disabled employee, with the main purpose of enabling them to perform their duties of employment, you will have no reporting requirements and no tax or National Insurance contributions (NIC) to pay under benefit-in-kind rules, even if they use it privately (whereas if the employee did not have a disability this would not usually be the case). The rules ensure that no tax charge arises on this benefit when provided to an employee with a disability, even if the employee uses the equipment both in work and outside work, and private use is significant.

You can find out more on GOV.UK.

An employer of a disabled person is also able to provide a car (including the provision of fuel and other related expenses) to an employee with a disability with no reporting requirements and no tax or NIC provided certain conditions are met. You can also meet certain costs free of tax to the employee such as for travel from home to work, which would normally be classed as a benefit-in-kind and taxed as such.

Details of these and the other minor adjustments to the tax law to take into account the needs of people with disabilities are given on our page for employees.

More information and support about employing a disabled person

GOV.UK contains guidance that will help employers to become more confident when attracting, recruiting and retaining disabled people.

GOV.UK also provides a collection of resources about employing disabled people, including the government publication on employing disabled people and people with health conditions and information how the Disability Confident employer scheme can help your business.

GOV.UK also has details of how you can be awarded the disability confident symbol – the scheme which shows you encourage applications from disabled people.

Jobcentre Plus provides information and advice to employers to support them in adopting good employment policies and practices in the recruitment, retention, training and career development of disabled people.

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