Hampshire Accounting Firm Urges Employers to Consider Tax-Efficient Rewards to Retain Valued Employees
Hampshire, UK – As businesses continue to face cost pressures, Hampshire-based HWB Chartered Accountants is calling on employers to explore alternative methods of employee retention. The firm highlights the importance of considering tax-efficient rewards and benefits, rather than solely relying on salary increases.
On the occasion of National Payroll Week (7-11 September), which recognizes the vital role of payroll and reward in the UK workplace, HWB stresses the significance of employers preparing for the upcoming Chancellor’s Budget on 28 October and its potential impact on the cost of doing business.
Director of HWB, Gary Brown, emphasizes the need for companies to move beyond traditional methods of recruitment and retention and instead, consider a more creative approach to employee engagement and loyalty.
“While salary remains a crucial factor in attracting and retaining staff, it is not always the most sustainable solution for businesses facing financial constraints,” says Brown. “Employers should explore different ways to enhance their overall employee proposition. For instance, share schemes and options can give employees a genuine stake in the future success of a company, while smaller benefits and recognition schemes can also make a significant difference in how valued employees feel.”
HWB suggests that businesses explore tax-advantaged share schemes such as Enterprise Management Incentives (EMI), Save As You Earn (SAYE), Company Share Option Plans (CSOP) and Share Incentive Plans (SIP), where applicable. The firm also recommends utilizing ‘trivial benefits’, which are small gestures of appreciation that can be provided without incurring tax or National Insurance charges, as long as certain conditions are met. These benefits must not exceed £50, cannot be cash or cash vouchers, and should not be provided as a reward for specific work or performance.
Other ideas put forth by HWB include long-service awards, employee suggestion schemes, staff events, enhanced training and development opportunities, and flexible working arrangements tailored to suit the needs of employees.
Brown adds, “It is crucial for employers to understand what their employees value, what the company can afford, and the tax implications of each option. National Payroll Week serves as a reminder that payroll is more than just processing salaries. It is a critical aspect of the relationship between employers and their staff. As businesses gear up for the upcoming budget and scrutinize their employment costs, it is an opportune time to review and optimize their reward packages.”
National Payroll Week is organized annually by the Chartered Institute of Payroll Professionals (CIPP) to acknowledge the contribution of pay professionals in the UK workplace, who ensure timely payment of salaries to millions of employees. According to the CIPP, payroll teams contribute a staggering £474 billion annually to the UK economy through collecting income tax and National Insurance.
HWB, a chartered accounting firm based in Chandler’s Ford, near Southampton, provides business and tax advice. For more information on payroll advice from HWB, please visit their website at www.hwb-accountants.com.
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