12 Top Tax Tips to Easter – #5 Exchange salary for benefits
We have launched a series of 12 tax tips to Easter to help you mitigate your tax bill. The run-up to Easter is the perfect time to consider tax planning opportunities and to put in place strategies to minimise tax before the new tax year starts on 6th April 2016.
Good planning and careful timing are critical if you want to maximise tax reliefs or minimise the tax bill on a transaction or investment, and to avoid falling foul of the system of penalties and interest levied by HM Revenue & Customs (HMRC).
Our tax tip #5 explains how exchanging salary for benefits can minimise tax for both employers and employees.
#5 Exchange salary for benefits
- Take advantage of any salary sacrifice arrangements being offered by your employer.
- Employees who sacrifice income to take them below the £100,000 threshold, in return for a tax free pension contribution made by their employer, could save income tax and NIC.
- For employers, there are corporation tax savings on the employer’s pension contributions as well as savings on employer’s NICs, these savings could be used to enhance the pension contribution for the employee.
Tax is a complex matter, so we recommend that professional advice is sought when considering any of the above. Our highly qualified and experienced tax team would be happy to discuss your tax affairs with you.
If you have any questions regarding your tax affairs, please do not hesitate to contact our tax team on 01491 579740.