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21 Tax-Free Benefits for UK Employees: A Comprehensive Guide for Employers

When it comes to incentivising and retaining employees, offering tax-free benefits can be a game-changer. Not only can they enhance your compensation package without increasing tax liability, but they can also make your business more attractive to potential hires. In this guide, we'll explore 21 tax-free benefits you can offer to your employees in the UK.

Tax Free Benefits for employees
Happy Employees

1. Workplace Pensions: Boost your employees' future by contributing to their pension scheme, which can be tax-free up to certain limits.

2. Childcare Schemes: Though Childcare Vouchers are phased out, they're still valid for those already enrolled. Now, the Tax-Free Childcare scheme has taken the baton.

3. Cycle to Work Scheme: Promote a green commute! Loan bicycles and safety gear without incurring tax.

4. Work Uniforms: Dress for success. Providing uniforms isn't just practical—it's tax-free.

5. Annual Health Check-ups: Ensure your team’s well-being with yearly health assessments, free from tax implications.

6. Mobile Phones: Whether for communication or as a perk, one mobile phone per employee is exempt.

7. Staff Parties: From summer BBQs to Christmas festivities, enjoy tax exemptions for events up to £150 per head.

8. Workplace Nurseries: Offer on-site childcare and enjoy a double win for employee satisfaction and tax savings.

9. Training: Invest in your team's growth. Job-related training costs won’t attract tax.

10. Trivial Benefits: A coffee or a thank-you note? Small gestures under £50 can be exempt, provided they aren’t cash or vouchers.

11. Electric Company Cars: Join the green revolution. Purely electric vehicles have favourable tax treatments.

12. Relocation Expenses: Covering the first £8,000 of relocation costs for employees can be tax-free.

13. Interest-Free Loans: Lend up to £10,000 without any tax implications.

14. Sports Facilities: Foster team spirit with on-site sports amenities, accessible for all.

15. Long Service Awards: Celebrate loyalty with non-cash awards for two decades of service.

16. Suggestion Scheme Awards: Value innovation? Offer tax-free rewards for game-changing

business suggestions.

17. Workplace Parking: A simple perk that's always appreciated—and it's tax-free.

18. Professional Fees and Subscriptions: Cover necessary fees and subscriptions to elevate job performance.

19. Season Ticket Loans: While not entirely tax-free, they're exempt from National Insurance.

20. Counselling Services: Support employee mental health with non-medical counselling.

21. Welfare Counselling: An exempt benefit ensuring employees’ well-being, no need to report to HMRC.

The landscape of tax-free benefits offers a wealth of opportunities for UK employers. By integrating these into your employee packages, not only can you enhance job satisfaction but also make significant tax savings.

Always consult with a professional to ensure you’re compliant with the latest HMRC guidelines.

Interested in navigating the world of tax-free benefits? Our team of accountancy experts is here to guide you. Contact us today!

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