Upwards of 90% of British firms operate some form of benefit or perks package to improve their employees’ engagement. We’ve all heard about both extremes of the scale, where a recruitment agency promises top earners fully-comped quarterly trips to top destinations or when a job description touts the statutory minimum number of holidays as an employment benefit.
Whatever you think of these unusual examples, there’s no question that employee benefits can have a serious impact on morale and retention if done right. There are even businesses offering a preset collection of perks on subscription to save other companies the effort of negotiating with businesses for discounts, etc.
And, of course, for many employees working from home has become the ultimate perk, cutting their costs and freeing up the time they’d have spent commuting at once.
Employee Benefits and Tax
While some employee benefits are tax free (most notably, childcare and canteen meals), the majority of possible benefits carry a tax obligation. This makes it all the more important to select benefits that the majority of your employees will find motivational.
Whether that’s extra days of holiday for those who’ve spent more than a certain length of time in the business, support in further training or adult education (especially for businesses which expect most of their employees to ‘graduate’ on to other jobs in time), or even something unusual like Spotify’s fertility assistance for their employees.
At ICS Accounting, we’re happy to help business clients to understand the tax opportunities and obligations inherent in their employee benefit programs. What we can’t do is suggest the right perks for you – but there are some ways to get good ideas.
Researching Employee Perks
What are your competitors offering? Remember that what they’ve chosen may or may not be working, so this isn’t guaranteed – and if you only duplicate their offerings, you can’t stand out from the pack. All the same, their staff are probably demographically similar to your own, so it gives you a starting point.
What, if anything, have former employees mentioned a lack of in their exit interviews, or on Glassdoor reviews and the like? These can be painful, especially if they’re critical or if the employee was a star within their team, but the information they reveal can be huge.
But if departing employees are a good source, current employees are a better one. After all, they’re the ones you’re directly aiming to motivate and retain. If they’re comfortable in their anonymity on a survey, then it can be the best way to get a clear picture. Ask what matters most to them rather than specifically what perks they want, as they may be unsure what budget is available – but once you know what they need you can match that against your budget.
For a sense of how this can fit into your spending and your tax situation, contact us directly.
