Employee Incentive Awards

An individual, in the United Kingdom, may be liable to pay National Insurance contributions (NICs) and pay-as-you-earn tax (PAYE) if he/she receives incentive awards that form part of his/her pay package – this is even applicable if an employee receives awards from a third party. There are dissimilar rules for what has to be reported and paid. These rules depend on the nature of the award and also, on who presents the award to an employee.

Incentive awards could be either of the following:

• Cash
• Holiday coupons
• Non-cash items like goods/medals
• Prizes for employer-run contests
• Vouchers comprising ones that can be swapped for cash

Cash or Vouchers Redeemable for Cash

Cash awards

Cash awards are, typically, included in the employee’s gross salary while computing both NICs and PAYE tax. However, if an employee receives cash award from another business, then the employer must compute and pay the National Insurance contributions payable on the award – the other business needs to subtract pay-as-you-earn tax from the award. An employer must:

• Report the worth of the reward to Her Majesty's Revenue and Customs (HMRC) on a Full Payment Submission (FPS) when the award is presented – even if this is prior to an employee’s actual payday
• Consider the amount in the fields – ‘taxable pay in this pay period’ and ‘pay subject to Class 1 NICs’ on an employee’s payroll record

Vouchers that can be redeemed for Cash

Such vouchers are considered as earnings, irrespective of who gave the voucher to an employee. Hence, an employee needs to:

• Add the voucher’s value to the employee’s additional earnings
• Notify any NICs for the wage period when the previous payment is made in the similar period
• Subtract and pay NICs and PAYE tax through payroll

Non-cash Vouchers – Vouchers Redeemable for Goods and Services only

Include the value of the vouchers in the employee’s income, unless the vouchers are pertaining to childcare vouchers or luncheon. For these, consider the voucher’s face value.

Below mentioned non-cash vouchers are exempt from National Insurance contributions

1. Childcare vouchers till a certain value
2. Social functions, for instance, a Christmas party, till the value of £150 per head
3. Travel between home-work-home on a work bus

If a different organisation or company provides an outside employee with a non-cash voucher, and the actual employer is not involved in the process then in such a scenario the actual employer is not liable to pay any NICs due on the award – here the onus is on the third party. However, if the actual employer arranges the non-cash voucher for another business, then when the employee gets the voucher, the actual employer must:

• Report the value of the non-cash voucher to HMRC
• Notify any NICs for the wage period when the previous payment is made in the similar period
• Add the worth of the award to an employee’s pay and compute NICs on the revised gross pay number
• Send an Full Payment Submission to HMRC and pay the NICs due

Other Non-cash Rewards

If any other company offers a non-cash award to another company’s employees, then the employee must report this to HMRC.

Reporting can be done in the following ways:

• By entering the gross value of the reward on form P9D or form P11D
• By entering into a Taxed Award Scheme

17th Employee Benefits Awards

The 17th Employee Benefits Awards celebrate the recognition of innovation and talent from the reward and benefits trade. The Employee Benefits Awards rejoices the most ground-breaking welfares strategies, motivating teams and exceptional individuals in the industry. With 21 categories committed to rejoicing the finest practice, winning an Employee Benefits Award does not only support the corporate to attract talent, rather also infuses a sense of pride that further than the HR and reward team. These awards are judged by a self-regulated board from diverse business sectors. The awards also serve as an extremely effective way to benchmark a corporate’s rewards and benefits offering around 600 United Kingdom businesses. The Employee Benefits Awards and Summer Party 2019 is scheduled for Friday, 7th June 2019 at The Pavilion at the Tower of London

Venue of the Award

The Pavilion at the Tower of London

The Tower of London

London

EC3N 4AB

Event Enquiries

Victoria Finch,

Senior Events Coordinator,

Telephone number: +44 207 943 8001,

E-mail: victoria.finch@centaurmedia.com

Table Booking Enquiries

Irfan Ahmed,

Delegate Sales Executive,

Telephone number: +44 207 970 4119

E-mail: irfan.ahmed@centaurmedia.com

Sponsorship Enquiries

Hannah Hicks,

Business Development Manager,

Telephone number: +44 207 970 4120,

E-mail: hannah.hicks@centaurmedia.com

Evaline Shawl,

Business Development Manager,

Telephone number: +44 207 970 4063,

E-mail: evaline.shawl@centaurmedia.com

Sponsors

• Headline sponsor: AON
• Other sponsors: Benefex, Capita, Simplyhealth, Wealth at work, Zest

Organisation shortlisted for the 2019 employee benefit awards

• Benefits team of the year – The shortlisted organisations are as follows:
  • Kier Group (Entered by Punter Southall Health & Protection)
  • Reed
  • Three UK
• Best alignment of benefits to business strategy – The shortlisted organisations are as follows:
  • Capgemini, MyBenefits (Entered by Aon)
  • E.surv Chartered Surveyors, part of LSL Property Services, ChoiceMatters (Entered by Benefex)
  • University of Lincoln
  • Virgin Atlantic Airways & Virgin Holidays, Working Well, Living Better (Entered by Unum/Aon)
• Best benefits communications - large employer- The shortlisted organisations are as follows:
  • AstraZeneca, My Reward (Entered by Benefex)
  • Kier Group (Entered by Punter Southall Health & Protection)
  • Nottingham University Hospitals NHS Trust (NUH), Launching a Home Electronics scheme for Christmas (Entered by Vivup)
  • Unilever (Entered by Computershare)
• Best benefits communications - small employer- The shortlisted organisations are as follows:
  • Non-Standard Finance (Entered by Computershare)
  • Secure Trust Bank Group, Boost - Benefits with real power
  • University of Lincoln, Linc-On Benefits Platform
  • Womble Bond Dickinson (UK), Benefits Roadshow 2018
• Best benefits to support work-life balance- The shortlisted organisations are as follows:
  • Arm, FlexPot (Entered by Thomsons Online Benefits)
  • Bank of America Merrill Lynch, Back up Care and Work+Family Space: Services to support, empower and retain working parents and carers (Entered by My Family Care)
  • London Borough of Waltham Forest
  • Pursuit Marketing
• Best employee engagement strategy- The shortlisted organisations are as follows:
  • Goodman Masson (Entered by ‘The Experience’)
  • Sky (Entered by Capita)
• Best financial wellbeing strategy - large employer - The shortlisted organisations are as follows (this award is sponsored by ‘Wealth at work’):
  • Anglian Water, A Multi-Generation Approach to Financial Wellbeing (Entered by Neyber)
  • Central and North West London NHS Foundation Trust, Launch of Money Wizard (Entered by Wealth Wizards)
  • Centrica, How Centrica's Employees engaged in saving for a brighter future (Entered by Standard Life)
  • INEOS (Entered by Wealth at work)
  • Lendlease, Preference (Entered by Benefex)
  • Sky (Entered by Capita)
  • Virgin Active (Entered by Salary Finance)
• Best financial wellbeing strategy - small employer- The shortlisted organisations are as follows:
  • Gattaca, Financial Wellbeing (Entered by ‘Smarterly’)
  • Goodman Masson (Entered by ‘The Experience’)
  • London City Airport, A Worry Bigger than the Workplace (Entered by Neyber)
• Best flexible benefits plan- The shortlisted organisations are as follows:
  • Aspen (Entered by Thomsons Online Benefits)
  • ServiceNow (Entered by Punter Southall Health & Protection)
  • Tokio Marine Kiln, Choices (Entered by Buck)
• Best healthcare and wellbeing benefits – large employer- The shortlisted organisations are as follows:
  • Carnival UK, Menopause initiative
  • Cisco Systems, CiscoPavelka Initiative (Entered by Pavelka)
  • KPMG
  • Norton Rose Fulbright
  • Novartis Pharmaceuticals UK, Ensemble (Entered by Check4Cancer)
• Best healthcare and wellbeing benefits – small employer- The shortlisted organisations are as follows:
  • Carlsberg UK, for a better today and tomorrow
  • Fire Security (Sprinkler Installations), Implementing Equipsme and Suffolk Mind's Health & Wellbeing programme (Entered by Equipsme)
  • Havas Media, Havas Equalise
  • OneWeb
  • Saint-Gobain Weber
• Best mental health strategy- The shortlisted organisations are as follows:
  • Experian
  • Landsec (Entered by Unmind)
  • Royal Mail Group, Because Healthy Minds Matter
  • Skanska UK
  • Three UK, Wellbeing Strategy
• Best pension communications- The shortlisted organisations are as follows:
  • BT, The BT Pension Scheme (BTPS) and The BT Retirement Saving Scheme (BTRSS) (Entered by Wealth at work)
  • IMI, Optimize (Entered by AHC)
  • Johnson Matthey, Johnson Matthey Employees’ Pension Scheme
  • Kier Group (Entered by Punter Southall Health & Protection)
  • Morgan Sindall Group, Fit for the Future (Entered by like minds)
  • Siemens, Project Pearl (Entered by Nudge)
  • Youngs Seafood (Entered by Personal Group)
• Best staff travel initiatives- The shortlisted organisations are as follows:
  • ENGIE, the Green Car Scheme (Entered by Tusker)
  • London Borough of Waltham Forest, Staff Car Pool Pilot
  • Sheffield Teaching Hospitals NHS Foundation Trust (Entered by Tuskerdirect)
  • University of Lincoln, Linc-On Benefits
• Best use of benefits technology- The shortlisted organisations are as follows:
  • Atos, Benefits Excellence (Entered by Benefex)
  • Bakkavor, Bakkavor Benefits Platform (Entered by Zest Benefits)
  • BNP Paribas, Spectrum Virtual Benefits Fair (Entered by blue goose)
  • Capgemini, My Benefits (Entered by Aon)
  • Reed Specialist Recruitment, Reward Hub (Entered by Reward Gateway)
• Best voluntary benefits- The shortlisted organisations are as follows:
  • Deutsche Telekom Services Europe AG (subsidiary of Deutsche Telekom Group), Time to Change
  • Newcastle upon Tyne Hospitals NHS Foundation Trust, Benefits Everyone
  • Sandwell Council, My Employee Benefits (Entered by Sodexo Engage)
  • University of Lincoln, Linc-On Benefits
• Most motivational benefits – The shortlisted organisations are as follows:
  • Colt Technology Services, Colt Inspire (Entered by Xexec)
  • Reed Specialist Recruitment, Apprentice Awards
  • Sunrise Senior Living
  • University of Lincoln, Linc-On Benefits
• Rising Star – The shortlisted employees are as follows:
  • Bethany Ridgewell, Npower
  • Dani Colvin Laws, Newcastle Upon Tyne Hospitals NHS Foundation Trust
  • Lucy Orchiston, EuroCarParts
  • Rhiannon Davies, hedgehog lab
  • Rosie Damarell, University of Lincoln
• Employee benefits professional of the year The shortlisted employees are as follows:
  • Adam Brooke, Bank of America Merrill Lynch
  • Ian Hodson, University of Lincoln
  • Tom Hiles, BNP Paribas

About the author

Sumit Agarwal
Sumit Agarwal (ACMA ACA India), the Managing partner of dns accountants is a highly respected accountant with expertise in helping owner-managed businesses.