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Salary Sacrifice and Optional Remuneration Arrangements (OpRAs)

A salary sacrifice arrangement is an agreement between employer and employee to reduce the level of upfront remuneration, usually in return for a benefit other than cash, such as childcare or improved employer pension contributions. This is known as a “Benefit in Kind” (BIK). Employers are able to initiate a salary sacrifice arrangement by agreeing to a change to the employment contract between them and the employee.


Tax-Free Childcare in the UK

In 2017, the government introduced a tax-free childcare subsidy, Tax-Free Childcare (TFC). Under TFC, the tax relief available is 20% of childcare costs, up to a total of £10,000 per child per year. The scheme will therefore be worth a maximum of £2,000 per child (or £4,000 for a disabled child). Parents can apply for TFC for children under 12 (up to 17 for children with disabilities).


Mandatory Disclosure Rules in the UK

Changes are underway to the cross-border rules on tax avoidance and disclosure. The Organisation for Economic Co-operation and Development (OECD) worked with the UK Government to devise the Mandatory Disclosure Rules (MDR). The new rules will come into force on 28th March 2023 and will mean that any new arrangements made after the implementation date should be reported to His Majesty’s Revenue and Customs (HMRC).


Employer Loans - The Taxable Benefit Explained

It may sound like a strange idea for an employee to ask an employer for a loan but depending on the relationship that they have with them and the employer’s attitude on the subject, they may wish to help in this way.


Contributing to a Pension Scheme

Nearly everyone who is in work in the UK should have access to their workplace pension scheme and should be automatically enrolled in it when they start work with the company. This is a fairly recent development.


Is your tax code correct?

The reason we have the Pay As You Earn (PAYE) system of tax collection in the UK is to enable Her Majesty’s Revenue and Customs (HMRC) to deduct the correct amount of tax from employed people at source.


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