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DON'T GIVE YOUR EMPLOYEES A TURKEY! TRY ONE OF GORDON'S STOCKING FILLERS.

26 November 2003 - Leading employee benefit consultancy, thomsons online benefits are highlighting a highly popular employee benefit that it is the perfect seasonal item for Santa's grotto.

In the 1999 Finance Act, Gordon Brown enabled employers to provide tax free loans on computers to employees. By entering into a salary sacrifice arrangement employees can lease the computer and pay for it over 36 months. At the end of the period they simply pay a nominal amount to purchase the equipment. Implementing such a scheme allows employees to buy £2,500 of computer equipment from pre-tax income whilst at the same time benefiting from a VAT refund and both employer and employee NI savings. Employees can save up to 50% of list price through the combination of salary sacrifice and VAT reclaim (subject to employer registration status) and the employer saves the NI contribution on the salary sacrifice amounts.
Such a scheme not only proves a very popular stocking filler with employees but it does not add to employment costs as employers typically use the national insurance savings to cover any costs in setting it up. Salary sacrifice is not a new idea but is currently enjoying a revival as employers seek to improve their cost base and transactional efficiency, and to find new and alternative ways to attract, retain and motivate employees.
Recently the Office of the e-Envoy published a consultation paper on its plans to raise awareness of the scheme in order to encourage more employers to provide this benefit.

Chris Bruce, Director of Strategic Alliances & Technology at thomsons online benefits comments "At this time of year employers are thinking about how they can reward employees for their hard work. Rather than giving the traditional turkey employers should think about taking advantage of this excellent initiative and the huge potential savings it can offer employees at no extra cost to the company."

Bruce adds a note of caution "Many employers may be reticent to introduce such a scheme for fear of the administrative difficulties it may present and because of the need to gain Inland Revenue approval for such schemes. Employers need to be aware that using salary sacrifice will involve an employee agreeing to vary their terms and conditions of employment and that it may not be appropriate for all employees." Santa's elves don't need to worry! thomsons online benefits assist employers in overcoming these issues by providing a simple online administration system which in running all the calculations required and aggregating all employee benefits in one place removes the complexity of administering salary sacrifice and flexible benefit schemes. In addition they have the financial advice and consultancy background to communicate the key issues effectively and simply to employees.

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For more information on thomsons online benefits

Caroline Shenton
thomsons online benefits
Tel: 020 7808 7588
Email: cs@t-bx.com
www.thomsonsonlinebenefits.com