Salary sacrifice for the self employed?

peach_2

I'm self employed (sole trader) but do a bit of work as PAYE and my other half is employed BUT neither of our employers' accountancy systems support salary sacrifice - therefore we can't benefit from the tax relief on child care available through childcare vouchers.

It seems we should be saving a packet but can't through no fault of our own! Anyone any ideas?

brantwood150

peach wrote:

I'm self employed (sole trader) but do a bit of work as PAYE and my other half is employed BUT neither of our employers' accountancy systems support salary sacrifice - therefore we can't benefit from the tax relief on child care available through childcare vouchers.

It seems we should be saving a packet but can't through no fault of our own! Anyone any ideas?

Not my area but could you not find a role that your other half could reasonably perform for your self emplyment business, employ them to carry out that role and offer them a salary package which allows salary sacrifice?

leftieM

There are companies (I only know of Busy Bees but others exist) that are willing to 'sell' the idea to an employer. As I understand it, it isn't too hard to set up so these companies offer to set it up and take a fee. As the employer's NI contributions are saved on the sacrificed amount, that money can be used to pay so it ends up as cost neutral for the employer and makes them look good.
Busy Bees certainly approach employers - maybe it's worth giving them a call? They might be able to advise you on SS for the self-employed too.

dunstonh

Salary sacrifice is up to the employer. However, since the introduction of the stakeholder pension rules, it is far easier to salary sacrifice with no complication to the employer. Many of the employer stakeholder/personal pension arrangements include the option for salary sacrifice. However, it appears many employers are not actually utilising what they can do (or should be doing in some cases). Probably as they do not know.

Any financial services company should be able to present the idea of salary sacrifice to an employer. Salary sacrifice does benefit both parties , as leftieM has said.

If you cannot persuade the employer, then working/childrens tax credits can be still be potentially increased from your own personal contributions into the pension, even if you dont get the full benefit. I wasnt aware that salary sacrifice would impact on childcare vouchers but then its not something that pops up often. Usually, salary sacrifice is used to enhance pension contributions with the NI saving.

NeilW

You could always incorporate your sole trader business. Then you can issue your own vouchers.

peach_2

Great responses - thanks for the time BUT my business isn't big enough to go ltd (yet!) and I don't think my other half would ever work for me so that's out! Also it's not that the employer's don't want to offer it ( one says they've been in discussions with busy bees) it's just that their accountancy/payroll system is so old it can't cope with salary sacrifice. I shall give busy bees a ring but any other ideas?Any other ideas?