How Can Employers Use the Tax System to Encourage a Healthy & Active Workforce?

Many employers offer a variety of incentives and programs which aid employees in maintaining a lifestyle alongside their work life. However, a recent report has shown that up to three quarters of workers days are spent at their desk which can lead to issues with back injuries, eye strain and stress. All of these are contributing to a workforce which has to take time off from work resulting in 25.7 million working days lost during 2016/17 costing up to £32 billion for UK business. Promoting a healthy work life with more physically active workers can bring a great number of benefits to you and your employees. Below we’ll take a look at some of the areas where you could promote health and fitness at work while also taking advantage of tax breaks and exemptions.

 

Gym Facilities and Memberships

There are many businesses which already offer gym or leisure facilities whether internally or provided by a third party. In house gym facilities offer a convenient option for workers and there will be no tax or NIC liabilities on the provision of this benefit. However, the following criteria need to be met:

• The facilities must not be available for general use by the public.
• They must be mostly used by employees, employee family members or households, former employees or employees from any company which has grouped with others to provide the facility.
• The facilities can not be located in a private home, holiday or other overnight accommodation
• They must not involve the use of any mechanically propelled vehicle i.e. road vehicles, boats and aircraft.

Of course, it is not always practical for some companies to offer these kinds of facilities. You may however be able to negotiate low membership rates at a local gym or leisure centre for your employees. This may lead to tax liability for employees, but the rate can often be 20-30% cheaper than the normal price.

 

Health Screenings and Medical Check-ups

You may also wish to consider trying to prevent the issues before any arise, with the use of employee health check-ups. The legislation will allow employers to fund health screening and/or medical check-ups for employees without a benefit-in-kind arising. The exemption applies to a maximum of one health-screening assessment and one medical check-up in any year for each employee.

The exemption is mirrored for NIC purposes, so provided the conditions are satisfied, no tax or NIC liability will arise where the employers provide preventative health screening and medical check-ups.

 

Recommended Medical Treatment

A further exemption applies for recommended medical treatment when employers help employees who may have been absent from work due to injury or ill health, return to work. The exemption covers expenditure on medical treatments recommended by the employer arranged occupational health services. This is subject to an annual cap of £500 per employee. Medical treatment includes any procedures for diagnosing or treating any physical or mental illness, disability or defect.

The exemption will apply when the employee has:

• Been assessed by a medical professional that they are unfit for work due to injury or ill health for at least 28 consecutive days
• Been absent from work because of injury or ill health for at least 28 consecutive days.

 

The legislation also provides an exemption for the cost of medical treatment abroad, where an employee has been injured or fallen ill while outside the UK while performing any duties for work. Also when providing insurance for the employee against the cost of treatment.

 

Eye Tests and Eyewear

An exemption allows employers to provide employees with an eye and eyesight test and corrective appliances such as lenses or glasses, if the test shows these are necessary.

There will be no tax or NIC charges if:

• The employer is obliged under the Health and Safety at Work etc Act 1974 to provide the test or appliances
• The tests and corrective appliances are available generally to all employees for whom the legal requirement applies

 

Research shows that 1 hour of activity can offset the potential harm of being inactive. The points discussed above show how employers can support employees in improving their health and well being. This in turn should lead to less absences from employees and overall create a more productive workforce.

 

If you would like to discuss any of the points above or have any queries then please contact us for further information.