As the family business grows, succession can be a challenge. In order to bring the relevant knowledge and expertise to continue to grow the business, it is usually necessary to move to a more “corporate” structure and recruit senior management out with the family. However, to attract and retain the right talent finding a remuneration package that rewards and empowers management, without conflicting with the family’s objectives, can bring challenges. This is an area many of our clients ask for assistance with as they strive continue their business success by striking the right balance of being commercially minded whilst continuing to protect their legacy.
The UK Government first introduced the Employment Allowance (EA) in 2014, which entitled employers to a reduction of up to £2000 from their secondary national insurance liability for the year. In April 2016, the allowance was raised to £3000 with a slight change in rulings which restricted single-director companies from claiming.
In April 2016, HMRC introduced new legislation to allow employers to provide tax-exempt gifts and entertainment to employees, namely Trivial Benefits. This exemption reduces reporting obligations and any tax or National Insurance charge where all of the following conditions are met:
We are now coming to the end of the 3rd full tax year of operating the Payrolling Benefits scheme since its introduction by HMRC back in April 2016. This scheme brought flexibility to employers in reporting employee benefits by providing an option to process them through payroll on a real time basis rather than submitting P11D forms in July after the end of the tax year.