27-01-2025

Can you claim National Insurance relief in UK Freeport or Investment Zone special tax sites?

You cannot claim until the relevant Freeport or Investment Zone special tax site has been designated.

The designated sites can be found on the links below

  • designated Freeport special tax sites
  • designated Investment Zone special tax sites

Who can claim

You can claim the relief if you have a business premises in a special tax site. A special tax site is an area of land where businesses can claim certain tax reliefs. Special tax sites are sometimes known as Freeport tax sites or Investment Zone tax sites. A Freeport tax site is independent and separately authorised from Freeport customs sites, but they can cover the same area of land.

Qualifying conditions for employees:

  • spend at least 60% of their working time in a designated special tax site
  • have started their employment between 6 April 2022 and before:
    • 6 April 2022 and 30 September 2031 for English Freeport special tax sites
    • 6 April 2022 and 30 September 2034 for Scottish Green Freeport, Welsh Freeport and Investment Zone special tax sites
  • be within the first 36 months of their employment
  • not have been employed by you or a connected employer in the previous 24 months

Public authorities are not able to claim the Freeport or Investment Zone employer National Insurance contributions relief.

You can claim this relief for all new employees for 36 months from the start of their employment for the period that they meet the qualifying conditions.

How to claim relief

To claim the relief, you must apply the relevant National Insurance contributions category letter when running payroll.


You must keep evidence of the qualifying conditions being met.

Some simple examples follow below.

  • An employee earning below the Freeport and Investment Zone Upper Secondary Threshold
  • An employee earning above the Freeport and Investment Zone Upper Secondary Threshold
  • An employee moving to a designated tax site after start of employment

An employee joins on 1 July 2024 and is paid £2,000 a month. They work 37.5 hours a week over 5 days.

The employee will spend 4 days of their working week, at the employer’s business premises in a special tax site and 1 day working from home for the remainder of the 2024/2025 tax year so they meet the 60% rule.

The employee was not employed by the employer or a connected employer in the previous 24 months.

The employee and the employer both meet the rules, and the employer claims the relief.

As the employee’s earnings are less than the Freeport and Investment Zone Upper Secondary Threshold of £2,083 per month, the employer will pay no secondary National Insurance contributions for this employee.

An employee joins on 23 May 2024 and is paid £3,000 per month. They work 37.5 hours a week over 5 days.

This employee will be spending 5 days a week at the employer’s business premises so they meet the 60% rule.

The employee was not employed by the employer or a connected employer in the previous 24 months.

The employee and the employer both meet the rules, and the employer claims the relief.

As the employee’s earnings are more than the Freeport and Investment Zone Upper Secondary Threshold of £2,083 per month, the employer will pay secondary National Insurance contributions on the amounts above the Freeport and Investment Zone Upper Secondary Threshold.

An employee starts on 6 April 2022 who is paid £2,000 per month. They work 37.5 hours a week over 5 days.

The employee’s working time is spent at the employer’s business premises which is located outside of a special tax site.

The employee was not employed by the employer or a connected employer in the previous 24 months.

The employer then expands by opening an additional business premises within a newly designated special tax site. On 6 April 2024, the employee is transferred to the employer’s new business premises. The employee will spend 4 days per week at the employer’s business premises in the special tax site, and one day per week working from home, so they meet the 60% rule.

The employer can claim the relief from 6 April 2024 (the date the employee started to meet the applicable conditions) until the 5 April 2025 (the end of their first 36 months of employment).

As the employee’s earnings are less than the Freeport or Investment Zone Upper Secondary Threshold of £2,083 per month, the employer will pay no secondary National Insurance contributions for this employee from 6 April 2024 to 5 April 2025.


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