BUSY WITH COMPLIANCE? FOUR DEVELOPMENTS YOU MAY HAVE MISSED
This year has been busy for compliance teams in the financial services industry, particularly so for private equity (PE) firms. The forthcoming introduction of MiFID II and upcoming changes to the Senior Management Systems & Control (SYSC) regime have been widely discussed and debated throughout the media, and no doubt we are all up to speed on the regulatory requirements that the industry now faces. While preparations for these changes are rightfully occupying vast amounts of attention, it is crucial that other compliance requirements are not forgotten. Failing to stay on the right side of the law can be costly, in monetary and reputation terms, so it is worth ensuring you are on top of any other forthcoming, perhaps less obvious, legislative changes. Below are three you may have missed.
Changes to employee benefits
Recent changes to employee benefits, particularly salary sacrifice schemes, came into effect as of April 2017 and are relevant for firms that offer staff specific types of benefits.
These schemes allow an employee to give up a proportion of their salary in return for perks such as childcare arrangements, healthcare and retirement benefits. There has long been a degree of controversy surrounding this scheme, and new regulations published by HMRC in August 2016 addressed these. Under new legislation, when an employee enters into any salary sacrifice scheme after 5 April 2017, a new tax charge will appear on their paycheck. The amount of this payment will be based on the greater of either the salary sacrifice monetary amount or the cost to the employer in providing the benefit.
The government has also confirmed that employers will be able to provide ‘intangible benefits’ to their employees. This covers benefits such as additional leave or pensions advice. These need to be declared as flexible working arrangements via salary sacrifice and will not be subject to the new legislation.
Oct-Dec 2017 Issue