{"id":26033,"date":"2017-02-02T19:16:16","date_gmt":"2017-02-02T19:16:16","guid":{"rendered":"https:\/\/www.wingatebs.com\/salary-sacrifice-changes-6th-april-2017\/"},"modified":"2017-02-02T19:16:16","modified_gmt":"2017-02-02T19:16:16","slug":"salary-sacrifice-changes-6th-april-2017","status":"publish","type":"post","link":"https:\/\/www.wingatebs.com\/salary-sacrifice-changes-6th-april-2017\/","title":{"rendered":"Salary Sacrifice Changes – 6th April 2017"},"content":{"rendered":"

What is salary sacrifice?<\/strong><\/p>\n

Many employers give staff the option to swap a part of their wage in return for a non-cash benefit. As a result of having a lower salary, employees pay less income tax and make lower National Insurance contributions. Likewise, employers save on National Insurance as this is linked to salary.<\/p>\n

Why is salary sacrifice under threat?<\/strong><\/p>\n

The more non cash benefits provided via salary sacrifice arrangements the less tax is collected by HMRC. The extent of this lost tax is very difficult to track because firms don\u2019t have to report exactly how much tax they and their employees save but the changes are expected to result in \u00a31bn of additional HMRC revenue over 6 years.<\/p>\n

Which benefits are to be cut and which are to be protected from the changes?<\/strong><\/p>\n

Cut<\/strong><\/em><\/p>\n

Company cars<\/p>\n

Work-related training<\/p>\n

Car parking near your workplace<\/p>\n

Gym memberships<\/p>\n

Health screening checks<\/p>\n

Mobile phones, Computers and tech<\/p>\n

Will-writing services<\/p>\n

Gadget insurance<\/p>\n

Group Life Assurance & Group Income Protection via Flex Benefit Scheme<\/u><\/strong><\/p>\n

Professional Fees & Subs<\/p>\n

Protected (in a bid to encourage take up)<\/strong><\/em><\/p>\n

Pension contributions (the largest cost to HMRC in this area) and Pensions advice<\/p>\n

Childcare vouchers,<\/p>\n

Cycle-to-work<\/p>\n

Ultra-low emission cars (75 co2 and below)<\/p>\n

N.B. Intangible benefits (buying and selling holiday) are not included in these changes\u00a0 <\/strong><\/em><\/p>\n

When will changes be introduced?<\/strong><\/p>\n

6th April 2017<\/p>\n

N.B.<\/em><\/strong> Any arrangements in place before this time will be protected for a year (until 5th<\/sup> April 2018). Long-term agreements for cars, accommodation and school fees will be protected until 5th<\/sup> April 2021.<\/p>\n

Are all the tax benefits being removed from the non protected arrangements? <\/strong><\/p>\n

The Government is scrapping relief on income tax and employer<\/span> NI contributions.<\/p>\n

Employees can still save their NI<\/span>.<\/p>\n

Will the affected schemes still offer any benefits once the new rules apply?<\/strong><\/p>\n

Yes, salary exchange schemes can still to continue to offer benefits to employees such as:<\/p>\n