Making a sacrifice

Vaneeta Khurana and Tony Nevin explain what optional remuneration (or salary sacrifice) means for employers 

The Government for some time has been concerned about the way in which the provision of benefits has evolved over the years with a growing market for flexible benefits, often combined with salary sacrifice arrangements. It recognises that such arrangements allow employers to attract and retain employees as part of their overall remuneration package in a very competitive and diverse employment market. However, it has stated that such arrangements both represent an increasing cost to the Exchequer and create inequality between employees and employers who benefit from the tax and National Insurance Contributions (‘NIC’) advantages, and those that don’t.