COMPLIANCE
Healthcare assistance Employers may choose to assist their employees with healthcare provision, and this can be done in several ways. Generally, the provision of private medical treatment or insurance will be a chargeable benefit for the employee. However, there are some circumstances where an exemption may apply. As always, professional advice should be taken to assess whether any of these exemptions applies to individual employees. The exemptions are detailed below: 1) Healthcare – helping employees to return to work after an injury or sickness There’s an exemption for medical treatment up to £500 to help an employee return to work. To qualify for the exemption, the employee must have either: ● been assessed by a healthcare professional as unfit for work (or will be unfit for work) because of injury or ill health for at least 28 consecutive days ● been absent from work due to injury or ill health for at least 28 consecutive days. Only the cost of the recommended medical treatment is included in the exemption and not any related costs, such as travel. The medical treatment can be recommended by the government’s ‘fit for work’ service or by an employer-arranged occupational health service. The exemption applies, regardless of who arranged and reimbursed or paid for the treatment. If the medical treatment provided includes treatment that isn’t exempt, HMRC advises that a reasonable apportionment of the costs may be made between qualifying and non-qualifying treatment for tax / National Insurance contribution (NIC) purposes. 2) Healthcare – operational risk injuries and occupational diseases Where an employee’s injury or illness can be shown to be a risk of the employee’s occupation and is caused by something that’s reasonably attributable to the employee’s office or employment and isn’t a risk common to everybody, there may be no chargeable benefit if the treatment is intended to return the employee to the state of health enjoyed before the injury or illness. This is most likely to apply in the emergency services sector. 3) Healthcare – eyesight tests and / or the cost of corrective spectacles or contact lenses This exemption is especially relevant with
taxable benefit and should be reported on a P11D, or by payrolling the benefit. Any contribution from the employee will reduce the benefit reportable. Mindfulness sessions to help with stress and / or anxiety Many organisations provided mindfulness and other stress relieving sessions to help with anxiety during the pandemic. Most EAPs have these resources for employees to use as and when they need them. Some organisations will have mindfulness training sessions that can be attended by employees either in-person or online. Both the EAP resources and training sessions will be covered by the welfare counselling exemption. Corporate discounts with third parties Many organisations provide platforms that have discounts available with third parties for their employees, which may support health and well-being. Some of these platforms are free, which means that it’s unlikely a tax charge will arise. In other cases, the employer may incur a cost – or there’s a definable cost of providing the benefit to the provider – which could result in a BIK charge arising. However, it may be that the BIK is small, and the employer is prepared to meet the tax / NICs charges arising via a pay as you earn settlement agreement (PSA). In some circumstances, it could even qualify as a trivial benefit. Healthy food in the office Providing food to employees would normally be a taxable benefit, but there are circumstances where this may be exempt. There’s no tax charge for the provision of discounted or free meals provided by the employer in a subsidised canteen, available to all staff. If an employer can’t provide and run such a facility, the provision of healthy snacks to staff generally, e.g., fruit, could qualify as a trivial benefit. Check the tax and NI implications Evidently, there are tax and NIC exemptions that can be used when providing a well- being programme for employees, but care should be taken when implementing any well-being strategies. Professional advice taken beforehand can give the best outcomes for both employees and employers by being tax and NIC efficient. n
the increased time spent in front of screens for online meetings and document access. There’s no chargeable benefit for an eyesight test and the cost of corrective glasses and contact lenses relating to display screen equipment (DSE) use. Only the cost of the DSE element of the prescription and basic lenses are exempt. Where the glasses are for general use but include a special prescription for DSE use, the proportion of the cost relating to DSE will be exempt.
Generally, the provision of private medical treatment or
insurance will be a chargeable benefit for the employee
4) Healthcare – periodic health screening and medical check-ups An exemption from a tax charge is available for medical screening / check-ups. Employees may have in any tax year: ● one health-screening assessment (a questionnaire / interview about general health and lifestyle to identify high risk employees who may then be offered a medical check-up), and ● one medical check-up (a physical examination by a health professional). These will be exempt for tax / NICs purposes. However, if the medical check-up is associated with any medical treatment that isn’t exempt, then it isn’t covered by the exemption. Gyms and gym membership The benefits of physical activity are a huge contribution to the health and well-being of employees. There are several ways employers can encourage employees to take more exercise and keep fit. Employers can provide a gym, sporting or recreational facilities for their employees. There are several conditions that need to be met for them to be free of tax / NICs. The main one is that the facilities aren’t available to the general public but are available to all your employees. The payment by an employer of a third- party gym membership for employees is a
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| Professional in Payroll, Pensions and Reward |
Issue 80 | May 2022
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