Guidelines from HM Revenue and Customs (HMRC) define a salary sacrifice arrangement as an agreement between an employer and an employee to change the terms of the employment contract to reduce the employee's entitlement to cash pay: Usually this sacrifice of cash entitlement is in return for some form of non-cash benefit.
Salary sacrifice schemes from P&MM Employee Benefits make salary sacrifice arrangements financially beneficial for both employer and employee. Such an arrangement is commonly seen in voluntary benefits packages including childcare voucher and cycle to work schemes and works by exchanging part of an employee's remuneration from cash; on which PAYE tax and NICs are due, to non-cash benefits; that are wholly or partially exempt from tax and NICs.
In recent years many UK companies have used the tax and national insurance savings gained through the implementation of salary sacrifice benefits to fund the implementation of a voluntary benefit employee discount scheme.
As P&MM Employee Benefits offers salary sacrifice schemes for childcare vouchers, cycle to work and annual leave purchase, and its lifestyle voluntary benefits scheme; it is able to fully integrate the schemes, offering you easier administration and even greater benefits.
To discover how you can get the most out of salary sacrifice for your employees, call us today on 0845 272 8713, or click below to find out more about our products.