Overview Benefits Employee
Although the weather is finally changing for the better and green shoots are
In the current economic climate, just having a job may be considered to be a substantial benefit in its appearing all around us, economically thingstoare still certain very bleak and the out-as own right. Despite this perception, employers are obliged provide other benefits to staff well. This document sets outs what those obligations are and provides alternative suggestions for remulook will remain wintery for some time to come. nerating and motivating employees.
It has been proven that well motivated staff, who feel valued by their employer, perform better and are more productive. Employee benefits can play a key role in achieving this.
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Historically, the provision of employee benefits gives rise to notions of complexity, expense and time costs. Despite this preconception, technology has improved so much that the administration of benefits is much more streamlined than ever before and the complexities and time commitment involved in running employee benefit schemes are vastly reduced. In fact, cost need not be a major disadvantage, as many benefit schemes offer significant tax advantages for employers. In other words, redefining how you reward your employees could lead to cost savings.
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You will need to explain to your staff why their income has reduced and what their options are.
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You will be forced to contribute at least minimum levels to the scheme, so even if you currently offer a pension scheme, it may not be sufficient to meet NEST requirements.
Pensions Since the 6th of April 2001, it has been compulsory for most employers to offer pension schemes to employees, although actual membership of such schemes has not been compulsory. However, this is set to change. Recent Governments have toyed with the best way to introduce compulsory membership of pension schemes for some time now and the National Employees Savings Trust (NEST) appears to be the chosen vehicle. It is planned that NEST will be introduced in the Spring of 2011 and it will eventually auto-enrol almost all UK employees into a national pension scheme. Employees and Employers will both have to contribute to the new scheme. Employers will need to make provision for payments, whilst the employees will see a reduction in their net income. You might assume that NEST will remove a head-ache for employers and reduce their responsibility to provide retirement benefits for staff, but in the short term, the introduction of NEST could result in potential problems, for example;
Your employees will be auto-enrolled at different times over a prolonged timeframe dependant on the first letter of their surname.
Whilst we all recognise that pensions provision for most people in the UK is woefully inadequate, many employers are worried about the Governments track record for introducing and administering national projects. Whilst we might agree with the sentiments behind NEST, what guarantees are there that we won’t face yet another state run disaster? Our advice is that all employers review their pension scheme arrangements well in advance of the introduction of NEST to ensure you can control your employee’s benefits and not the Government by default. It is possible to make pension provision for employees and reduce both employer and employee National Insurance Contributions. Pensions steal the limelight, but they are not the only benefits employers can provide. Many of the other benefits we can assist with are also available not just to the member, but their families as well.
unthinkable were to happen. Group death in service insurance schemes offer significant savings against individual life assurance, with eligibility for tax relief for the employer. Underwriting and paperwork is usually very simple and uncomplicated in most cases, especially as there will normally be a level of cover which will require no underwriting. What is death in service insurance? A Death in Service Cover Plan provides a lump sum benefit for the employee’s family in the event of his/her death, helping to cushion the impact of loss of salary on their dependants. How does death in service insurance benefit employers and employees? •
Relieves moral burden should an employee die whilst in service.
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Provides a lump sum benefit for the employee’s beneficiaries of up to 4 times final earnings.
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Helps attract and retain loyal employees.
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Tax efficient - premiums are a trading expense.
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Approved benefits are not “benefits in kind”
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Continuous entry for new members.
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Generous free cover level minimises underwriting.
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Continuation of existing cover without medical evidence.
Life Cover Probably the most cost effective life assurance cover available, death in service insurance ensures employees have a significant lump sum for their dependents whilst employed if the
We work with employers to develop an employee education and advice strategy, to best deliver advice to employees as part of their overall employee benefit programme.
Death In Service Benefits
Whatever the individual’s situation or requirements, we can assist them to find a solution, whether that be:
Group Critical Illness Cover
Group Pensions
Protecting their Family Guidance on a range of options, including private medical insurance, long-term care, income protection and life assurance.
Possible Employee Benefits
Developing a Retirement Plan
Keyman Cover
Group Income Protection
Advice on developing an effective strategy to prepare for retirement and to maximise income and security in retirement. Savings and Investment advice
Group Private Medical Cover
Help in choosing exactly the right option, whatever you’re saving for. Estate Planning
Private Medical Insurance Private Medical Insurance can be provided for employees or extended to cover their family members as well to help protect them from unexpected healthcare expenses. Wills & Estate Planning We can arrange to host a will writing clinic at your business premises. The format is very flexible but usually comprises: 1. An open seminar lasting 20-30 minutes outlining the importance of having a Will and some of the tax saving services that trust planning can offer.
We will agree terms with you and source the optimum contracts in each of the relevant employee benefit areas to provide the most suitable solution for your needs. We can provide group presentations to your employees about the benefits you, as their employer, are willing to provide them with – the communication of how the employee benefits will help staff is key to their success. We can also provide individual one to one meetings with staff as requested to explain the benefits to them and complete the membership applications where appropriate. Ongoing support
2. This is followed by a one-to-one confidential meeting between a solicitor and any staff members who would like more detailed information or want to discuss their personal circumstances. 3. If the demand is sufficient and for relatively uncomplicated wills, it may be possible to produce the documentation there and then so that staff will have a fully completed and witnessed will on the day. The Process We offer all employers a free initial meeting to discuss your existing benefits, review how suitable those arrangements remain and consider any other benefits you may require.
We can provide at least an annual review for all members, which will also incorporate a free review of their financial and estate planning needs, should they require it. You will also have access to your MSFS contact whenever you need it at no additional cost.
Assistance in reducing the impact of inheritance tax, to preserve and protect your estate for your beneficiaries. Cash Management Employers also have to maintain the cash flow needs of the business. Getting a reasonable return on cash held in bank accounts has become a significant problem in recent years. We appreciate that all companies will need to keep some monies readily available at all times, but we can offer solutions which aim to generate higher returns than those that are currently available from banks and building societies through our Cash Management Service and our low risk, cash alternative investment strategies. Next Steps We offer all employers a free initial meeting to discuss your existing benefits, review how suitable those arrangements remain and consider any other benefits your may require. To arrange your free initial meeting, use the contact details overleaf to get in touch with us.
Moore Stephens in the UK Moore Stephens is currently the UK’s11th largest independent accounting and consulting association, comprising over 1,500 partners and staff in 39 locations. Our objective is simple: to be viewed by clients as the first point-of-contact for all their financial, advisory and compliance needs. We achieve this by providing sensible advice and tailored solutions to help clients achieve their commercial and personal goals. Clients have access to a range of core and specialist services including audit and tax compliance, business and personal tax, trust and estate planning, wealth management, IT consultancy, governance and risk, business support and outsourcing, corporate finance, corporate recovery
Who to contact Corby Oakley House Headway Business Park 3 Saxon Way West Corby NN18 9EZ Tel: 01536 462700 enquiry@msfs.co.uk Peterborough Rutland House Minerva Business Park Lynch Wood Peterborough PE2 6PZ Tel: 01733 397300 enquiry@msfs.co.uk
and forensic accounting. Our success stems from our industry focus, which enables us to provide an innovative and personal service to our clients in our niche markets. Specialist sectors include energy and mining, financial services, insurance, not-for-profit, pensions, professional practices, real estate, shipping, transport and public sector. Moore Stephens globally Moore Stephens International Limited is a global accountancy and consulting association with its headquarters in London. With fees of US$2.24 billion and offices in 98 countries, you can be confident that we have access to the resources and capabilities to meet your needs. Moore Stephens International independent member firms share common values: integrity, personal service, quality, knowledge and a global view. By combining local expertise and experience with the breadth of our UK and worldwide networks, clients can be confident that, whatever their requirement, Moore Stephens will provide the right solution to their local, national and international needs. Moore Stephens is a global association of independent member firms.
www.msfs.co.uk This document is provided for information purposes only and does not constitute any form of financial or investment advice. Past performance is not a guide to future investment performance. The value of your investments as well as any income derived from them can fall as well as rise and you could get back less than the amount invested. We believe the information in this brochure to be correct at the time of going to press and is based on our current understanding of legislation and tax allowances which may change in the future. As such changes can’t be foreseen we cannot accept responsibility for any loss accessioned to any person as a result of action or refraining from action of any item herein. Printed and published by Moore Stephens Financial Services (East Midlands) Limited. Authorised and regulated by the Financial Services Authority. January 2011