Salary sacrifice for the provision of benefits in kind

During the 2016 March Budget, then-Chancellor of the Exchequer, George Osborne, announced that HM Revenue and Customs (HMRC) would consider limiting the range of benefits-in-kind that attract Income Tax and National Insurance Contributions advantages when provided as part of salary sacrifice arrangements.

The purpose of this consultation was to explore potential impacts on both employers and employees should the Government decide to change the way that the benefit code applies when a benefit-in-kind is provided in conjunction with a salary sacrifice or flexible benefit scheme.

Employer pension contributions, employer-provided pension advice, employer-supported childcare and provision of workplace nurseries, as well as cycles and cyclist’s safety equipment provided under the ‘cycle to work’ scheme would remain unaffected by any measures taken by HMRC as a result of this consultation.