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KEY POINTS
- Childcare arrangements and salary sacrifice.
- Changes from April 2011.
- Basic earnings assessment.
- Warn employees of new rules.
On 3 December 2009 the Labour government proposed changes for the future tax and National Insurance treatment of employer-supported childcare. The current government intends to proceed with these changes and legislation has been published in the draft Finance Bill 2011.
Many employers offer directly contracted or childcare voucher schemes through salary sacrifice arrangements. These and salary plus schemes will fall within the new provisions.
The workplace nurseries exemption was introduced many years ago. This exempts from tax and National Insurance the provision to an employee of a place in a nursery at the workplace or in a facility wholly or partly financed and managed by the employer.
While such arrangements are not that common in small and medium-sized...
