Employee Assistance Programme – HMRC Tax Implications

You may have heard the comments in the press over the last few years in relation to the taxation position of Employee Assistance Programme and we have been lobbying the Government for a long time for clarification.   Finally HMRC have provided some points of clarification surrounding the P11d liability for all employees who benefit from an EAP. 

It is our understanding that the core element of the HMRC guidelines relate specifically to dependants (of employees) gaining access to certain aspects of your Employee Assistance Programme:  

There must not be a separate helpline number for spouse/partner/dependants.

Couple or family counselling will not prevent the exemption from be applying but a spouse/partner/dependants must not be offered face to face counselling on their own.
Spouse/partner/dependants will not be provided with legal or financial advice within the EAP.

Further clarification can be found on the GOV.UK website via the links below:

https://www.gov.uk/expenses-and-benefits-counselling

https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim21845

We have subsequently instructed all our Provider-Partners to only provide EAP services to our clients that fall within the tax exemption element of the services.  We will continue to monitor the position.

Your Health Matters Assistance Programme service continues to offer one of the most accessible, comprehensive and high-quality EAP services available to Organisations based in the UK.  We want to ensure that your employees are fully aware of the EAP they have access to and the wide range of services they can gain access to, so if you require additional promotional leaflets, posters, bulletins or e-materials for your company Intranet, or if you wish to look into the possibility of arranging Onsite-Manager Briefing Sessions/Workshops please feel free to contact me directly.

If you would like any additional information or if you have any concerns please do not hesitate to contact me.

sImon@www.health-matters.co.uk