Salary sacrifice schemes are a way of providing employee benefits by giving employees the option of handing over part of their gross salary in return for whatever the benefit may be. The advantage is that employee salaries are only taxed subsequent to making the sacrifice, therefore saving the employee money. Employers save as well, by not paying Secondary Class 1 National Insurance contributions on the sacrificed portions of staff salaries.

It may go without saying, but employee benefits don’t just benefit employees. Indeed, there are a lot of advantages to employers offering employee benefits too. Fundamentally, as you might expect, these all boil down to a company’s bottom line.

The vast majority of employers provide their employees with a benefits package in one form or other, with the likes of annual leave, pensions and public transport season ticket loans among the most popular perks offered. Although few employees will give much thought to it – because it’s not necessarily that pertinent – benefits can be split into one of three categories.

The vast majority of employers provide their employees with a benefits package in one form or other, with the likes of annual leave, pensions and public transport season ticket loans among the most popular perks offered. Although few employees will give much thought to it – because it’s not necessarily that pertinent – benefits can be split into one of three categories.

In addition to rewarding staff for their work, employee benefits are advantageous to employers by helping to attract, motivate and retain staff. Of course, different people value different benefits to a greater or lesser extent than others, so it’s important to offer the right benefits to ensure they are offering value to both employees and the employer. 

It may go without saying, but employee benefits don’t just benefit employees. Indeed, there are a lot of advantages to employers offering employee benefits too. Fundamentally, as you might expect, these all boil down to a company’s bottom line.

Salary sacrifice schemes are a way of providing employee benefits by giving employees the option of handing over part of their gross salary in return for whatever the benefit may be. The advantage is that employee salaries are only taxed subsequent to making the sacrifice, therefore saving the employee money. Employers save as well, by not paying Secondary Class 1 National Insurance contributions on the sacrificed portions of staff salaries.

When we think of employee benefits, it’s easy to think of some of the more desirable things that businesses offer, like duvet days, bonuses and company cars. As shown by the CIPD’s handy benefits guide, though, some of the more mundane perks that companies offer are classed as benefits too, often without us realising.