What benefits can be included in a salary sacrifice scheme?
Although there are some benefits that have additional tax advantages for employee and/or employer (see tax and National Insurance efficient benefits) just about any benefit can be offered as part of a salary sacrifice scheme. What are the benefits for an employee? A salary sacrifice scheme means that an employee will save on National Insurance on the full amount sacrificed (except in the case of childcare vouchers where employees save NI on the first £243 per month), as benefits in kind do not suffer the same levels of National Insurance as salary. Although Class 1A NIC is payable by the employer on most benefits they do not currently attract Employee Class 1A NIC. Therefore the employee can save up to 11% National Insurance. The actual savings depend on factors such as whether the employee is contracted-out or not as well as whether they earn above the upper earnings level. What are the benefits for an employer? The employer also benefits, as they are perceived to have added value to
