DSH Chartered Accountants & Business Advisors has a good idea for Kent business owners and managers – reward staff and save tax and National Insurance at the same time by implementing a Staff Suggestion Scheme.
A Staff Suggestion Scheme allows businesses to reward their employees financially for making suggestions to improve the business and these payments are exempt from tax or National Insurance. The business also qualifies for tax relief on any payments.
Under the terms of the scheme, payments of up to £25 can be made to each employee for each bright idea they have, and a maximum limit of £5,000 can be paid if the suggestion is implemented and the benefits recorded. The Staff Suggestion Scheme must be formally set up but approval from HMRC is not needed.
Steve Carpenter at DSH’s Maidstone office said: “The beauty of this scheme is that it benefits both the employer and the employee. The employer stands to improve its efficiency or effectiveness by acting upon the ideas of those who know the business best, its staff, as well as gaining tax relief on the payments it rewards its workers with, while the employees will receive a cash incentive for helping to drive the business forward.
“In order to qualify for the tax free payment, a suggestion must be outside the scope of the employee’s normal duties. To implement a formal scheme all the employer needs to do is publicise the details to its staff openly – for example, by posting a simple set of scheme details on the office notice board.”
To find out more about DSH Chartered Accountants & Business Advisors, visit www.dsh.co.uk or call 01622 690666.