Salary Sacrifice Products

SALARY SACRIFICE SCHEMES

As a concept, Salary Sacrifice has been around for a long time. It simply involves an agreement between an employee and an employer to reduce the employees' basic pay, in return for a stated benefit.

In most instances, there is little point in exchanging salary for a benefit because most benefits are treated as benefits in kind and taxed accordingly. However, certain benefits enjoy tax-free status (or a degree of) and if the benefit would not otherwise have been offered by the employer, a salary sacrifice can make very good sense.

Most salary sacrifice schemes result in tax and national insurance savings for the employee and also, national insurance savings for the employer. The savings enjoyed by the employer will always more than cover the cost of operating the schemes. With certain schemes, VAT on the benefit can be recovered by the employer and under salary sacrifice rules, the VAT does not have to be passed on to the employee, further enhancing the saving.

Fair Care is an experienced operator of salary sacrifice schemes, working within existing legislation to deliver savings both to employees and to employers. Fair Care currently manages salary sacrifice schemes on behalf of over 1000 clients.

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