Cofunds calculates tax positions for flexible benefits

Cofunds, an independent platform for financial services, employs about 650 permanent staff at its London and Chelmsford offices.

All employees are members of the company’s flexible benefits scheme and receive core benefits including private medical insurance (PMI), a 5% employer pension contribution and income protection.

Flex options include childcare vouchers, a bikes-for-work scheme, dental insurance and increased pension contributions.

Andrew Deveney, head of reward and HR operations at Cofunds, says: “It is a real mix of tax scenarios, so it is important to communicate this to employees to help them make decisions when they are picking benefits.”

To do this, Deveney works with Thomsons Online Benefits and Cofunds’ auditors to map the tax position of each benefit. This information is then included in Cofunds’ flex renewal brochure and on its online benefits portal.

“For every benefit, we include information on whether an employee can save tax, national insurance or both,” says Deveney.

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Cofunds plans to introduce more information on employees’ payslips. “We tax at source rather than through P11D because employees prefer to pay tax as they go,” says Deveney. “A benefit such as medical insurance can be a big tax hit through a P11D, especially if the employee has not claimed. More granularity on the payslip would improve the information provided to employees and reinforce what they have picked through the flex scheme.”

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