The number of employees receiving major job perks has fallen to a 12-year low amid corporate cost-cutting and increasing taxes, research shows.
The total number of people receiving taxable job perks (benefits-in-kind) from their employer, such as company cars, private medical insurance and accommodation for staff, dropped by 600,000 in the last year to 3.6 million.
UHY Hacker Young, which compiled the figures, said the decline could also be driven by the increasingly challenging economic environment businesses face, forcing them to reduce costs.
Employee perks can often be the first to be cut. Company cars for example – one of the most common perks, which have suffered from an ever-increasing tax burden – saw a decline of 5% to 890,000 in 2017/18 from 940,000 2016/17.
The complexity of the tax system on perks has also made them less popular among employees. Confusion over issues such as what is and isn’t exempt from tax may have led businesses, especially SMEs, to scrap employee perks altogether, the accountancy suggested.
Neela Chauhan, personal tax partner at the firm’s London office, said the decline is a real shame because perks can act as an important tool in retaining staff and lowering staff turnover, and encourage greater staff performance.
“In tougher economic times the cost of the job perk, its tax charge, NI and the paperwork on top of that – is just too much for some employers,” she added.