Employers warned of immediate salary sacrifice challenges.

It is believed that the Chancellor will announce changes to the treatment of certain salary sacrifice benefits during the Government’s Autumn Statement. There is an immediate challenge for employers and employees. With the HMRC salary sacrifice proposals in consultation, employers are unclear how to communicate the potential tax and National Insurance Contribution (NIC) implications of benefit choices to employees. Employees could make their selections without knowing full financial implications. Martha How, reward partner for Aon Employee Benefits, said: “This timing challenge is likely to impact the majority of employers. For Aon alone, this enrolment period (between September and December 2016) represents 60 percent of our flexible benefit clients. Employers have a real concern for employees who will be making benefit selections when the tax and NIC situation is still unclear. How do employers communicate to staff that they can make selections as normal, but what they choose may or may not provide a tax or NIC benefit? This transition period is quite messy for employers and employees.”