COMPLIANCE
W ith inflation and energy prices still at a high, many are struggling to make ends meet. Issues with recruitment and retention are another worrying factor as organisations struggle to fill vacancies. So, what can employers do to help current employees and attract new ones, and what are the tax / National Insurance (NI) implications of the help that can be offered to employees? Many organisations are looking for ways to help employees through this crisis. Any assistance provided must have the aim of providing help and, ideally, any tax / NI liabilities should be kept as low as possible. There are tax efficient ways employers can help their employees, that don’t create an ongoing financial cost to the organisation in the same way an increase in pay would. Indeed, there are some options which can give the organisation cost savings, as well as helping employees. This article will give an overview of some of the ways in which organisations can help employees with the cost-of-living crisis and explain the tax implications. However, please note that advice should always be taken to ensure the terms of any exemption are met in full and any salary sacrifice schemes are compliant. Some organisations may already operate the schemes and well-being programmes we’ll be exploring. This article will help your organisation to identify these opportunities and provide the clarity to communicate them effectively to employees, as well as providing the impetus for new ways to help employees. “So, what can employers do to help current employees and attract new ones, and what are the tax / National Insurance (NI) implications of
Understanding the tax and National Insurance implications of helping employees’ financial well-being
Beverley Gibbs, employment taxes consultant, PSTAX, discusses the liabilities that could potentially arise when employers provide assistance to their employees
the help that can be offered to employees?”
| Professional in Payroll, Pensions and Reward | June 2023 | Issue 91 22
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