Regular followers of this blog, or attendees at our recent events, will be aware that the proposed merger of Income Tax & National Insurance (NI) has some seriously bad implications for the provision of UK employee benefits.
Whilst that may sound like pure scare-mongering, I would refer you to our recent survey in which 81.8% of our London event delegates (numbering more than 160 individuals) indicated that they rely on Salary Sacrifice to provide at least some of their employee benefits (this could be anything from Childcare Vouchers, to Pension Schemes or even Flex Benefits). The proposed merger of Income Tax and NI would remove the attractions of this funding method.
To see our full press release on this subject: http://www.jelfgroup.com/cms_files/documents/salary_sacrifice_-_london_zoo_-_final_-_approved.pdf
Should the merger happen, there is a very real danger that employers could withdraw or scale back such benefits to avoid an additional cost burden. The Government could be lighting the touch-paper for a significant increase to both the UK savings and risk gaps. This is surely not in the interest of anyone in the UK (including the Treasury).
So, what can we (and specifically you) do about this?
The initial treasury consultation on this subject is now open for responses. You can visit this by following this link:
It is vital that both UK employers, and the benefits industry, makes strong representations regarding this possible implication of the merger. I would therefore urge you to respond to this consultation as quickly as possible (Jelf will also be doing so separately).
The consultation questions raised in the document are not necessarily a good fit with the Salary Sacrifice argument (being more concerned with the detail of Tax and NI processing), but I would suggest that responses to questions 5 and 7 from page 10 can be used by those who wish to make this important point.
The initial consultation concludes on the 19th September, so you need to make your representations before then. Your voice could make a difference, so please do respond to this call for evidence.
Alternatively, please feel free to contact me (email@example.com) if you wish to add a comment to our submission.
Thanks and best regards