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Employee Benefits News

Latest News
30 Nov 2015

How the Autumn Statement will affect employee benefits

Chancellor George Osborne recently announced details of the government´s 2015 Autumn Statement and Spending Review. The Employee Benefits website decided to look in more detail at how the key changes would impact employee benefits when they come into force.

Firstly, in regards to pensions, it was revealed that the next two phases of increases to the minimum pension contribution rate, under auto-enrolment, will be moved back to coincide with the tax year. It was also confirmed that the government will remove barriers to creating a market for secondary annuities, enabling people to sell on any existing stream of annuity income.

Osborne also announced that the triple lock will remain, with the basic state pension rising to £119.30 per week as of April 2016, while the single-tier pension rate has been set at £155.56 per week.

More working parents will be able to take advantage of the government´s new tax-free childcare scheme, as the upper income threshold will be lowered from £150,000 to £100,00 per year.

Tax rules for employee share schemes will also be simplified. The Finance Bill 2016 will introduce measures to make certain aspects of the scheme more streamlined for both tax-advantaged and non tax-advantaged schemes.

Company car tax will continue to have a diesel supplement, with a 3% differential between diesel and petrol cars between April 2016 and 2021, when EU testing procedures will make sure that diesel cars adhere to strict standards of air quality.

The government also declared that it will be undertaking a review of sickness absence within the public sector. It is yet, however, to take any further action regarding salary sacrifice arrangements. Osborne explained that they will continue gathering evidence, including from employers, to inform the government´s approach on any decisions that it makes on this issue.

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