Recent CIPD research revealed 1 in 4 workers believe money worries are affecting their performance at work. Financial insecurity can affect anyone and is not limited to a personality type, profession, income or job title. Contributor Tony Mills, Director – Online Tax Rebates.
When employees are stressed their health and productivity levels can suffer. In fact, over half of employees use time at work to deal with personal financial matters. Here are five work-related tax entitlements employees could be missing out on and how to help them benefit…
Working from home
Traditionally only offered to a select few, remote working is becoming increasingly popular especially amongst millennials who now make up 75 percent of the workforce. By offering flexible working and the chance for employees to work from home, businesses gain access to a wider pool of talent and can appeal to those who may initially be put off by a long and costly commute.
With 45 percent of people spending over an hour commuting a day and over half feeling they are more productive working outside the office, every business should consider this benefit. Not only does this give employees greater flexibility and a healthy work-life balance, it also lessens the demand for office space and therefore reduces overhead costs for businesses.
It is important to advise employees on how they can make the most of the tax relief options on offer when it comes to working from home. Employees can be entitled to up to £4 a week (or £18 a month) to cover additional costs incurred like business telephone calls, gas and electricity. Be sure to regularly communicate this and not just during the hiring process.
Professional memberships
Employees could be entitled to further tax relief if they’re a member of a professional society or organisation. Currently, staff at over 3,000 organisations across the UK are eligible if they’ve paid for their membership themselves and it relates to their role.
Professional memberships can benefit both an employee in terms of career development and salary scale and businesses whose staff are equipped with the latest knowledge and skills.
Send out an email survey to all staff asking if they have any privately-funded memberships and explain the tax entitlement. This not only shows their interests are at the center of the business, it also supports both their financial security and professional development.
Expenses
Expenses can be expensive for employees and businesses. Recent studies have shown that almost 75 percent of people surveyed said they spent up to £100 every month on business expenses, while 85 percent of employees stretch the truth when making claims. This costs the UK economy up to £1.6 billion every year.
How can you create an effective expenses policy and system for your employees to adhere to? Discipline is key in the case of expenses. Always request your employees provide a VAT receipt, so you can see what the money has been spent on and how much you can claim back.
Make the whole process more efficient by going mobile. Encourage employees to download apps which record expenses in real-time and provide a clear log of pending claims.
Uniform and protective clothing
Are all or some of your employees obliged to wear uniforms while at work? If the answer is yes, they’re more than likely entitled to a tax refund for the upkeep. This tax entitlement covers both branded and protective clothing and can be extended to tools too. Claims can be backdated to the last four tax years and received as a single payment, while any future claims will be paid in wages.
Employees can quickly find out how much they’re owed by entering a few simple pieces of information into this online calculator which will provide an estimate and send out the relevant forms. Make sure all new starters are aware of this entitlement and keep a register of who hasn’t put in a claim, so you can send out reminders.
Childcare
Childcare fees on average cost up to £11,000 a year, leaving parents with the difficult decision to pay up or put their careers on the back burner. From October 2018, the Government is replacing its Childcare Voucher Scheme with a new Tax-Free Childcare Scheme, offering eligible families 20 percent extra towards childcare costs.
The main point of difference is it’s now the employee’s responsibility to claim instead of being delivered through the workplace. The original childcare voucher scheme will continue to run, meaning employees may need support in deciding which scheme is best for them before making a final decision or transferring. This can be a complex area to navigate but the savings can be great. Keep your workforce up to date about any policy changes via email notifications or quick workshops using language they can understand and give them actionable next steps.
