Flexible Benefits Packages for Your Staff

If you are an employer, what benefits do you offer your employees? And is yours one of the growing number of companies that have opted for the trend towards providing a flexible choice?

It’s now estimated that over 500 companies offer ‘flex’ schemes in the UK, including such names as The Body Shop, Emap and Cadburys, with some larger companies offering as many as 13 flexible options.

Self-service benefits

Many employers use flex schemes to help recruit and, ultimately, retain staff. Such schemes are basically self-service packages where you offer employees a benefits allowance – usually equating to the sum they would need to buy back their old benefits package, expressed in either pounds or points.

But they don’t have to buy back what they used to get, because they can allocate their money towards a menu of different options. Most schemes also allow employees to take extra money out of their salary if they wish, so that they can buy more than their allowance affords.

Guiding employees

After years of leaving it to someone else, it can be unsettling for employees to have to handle decisions themselves. It is estimated that about half the people offered a flex scheme stick to their old package because they’re afraid of making big mistakes. Empowerment is all very well, but most people really need advice. This is where we can help, and we can also advise and guide your employees through any complicated tax implications.

Although most benefits are taxable, employees shouldn’t be any worse off because they would have paid tax on their salary anyway. But the way they pay this tax will change. Instead of being taxed monthly as they go along, they won’t find out how much tax they’ll have to pay until they get a P11D at the end of the tax year. At that point, their tax codes will be adjusted, and they’ll start paying extra tax on their benefits.

Spoilt for choice


By sacrificing some of the benefits they had in their previous package, employees could free up money to spend on things they really want.

Benefits most commonly included in flex scheme
  • Season ticket loan
  • Dental insurance
  • Home Insurance
  • Long-term care insurance (more info)
  • Legal advice/counselling
  • Company car
  • Critical illness insurance (more info)
  • Shares or share options
  • Additional death in service insurance (more info)
  • Annual holiday leave

Benefits most commonly included in voluntary benefits schemes
  • Hospital/healthcare cash plan
  • Private medical insurance (PMI)
  • Stakeholder pension
  • Additional voluntary contributions to pension
  • Gym membership
  • Travel insurance
  • Motor insurance













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