// EXPERT PROFILE // threshold, meaning that certain employers paying more than £ 100,000 in Class 1 National Insurance liabilities can apply for Employment Allowance. If you’ ve not claimed before, double check your eligibility and get it sorted before your next payroll run. You could end up saving thousands.

2. Use salary sacrifice schemes

Salary sacrifice schemes allow employees to exchange part of their salary for benefits such as pensions, electric vehicles, or cycle to work schemes. Their taxable salary drops, meaning reduced NIC and income tax bills for both parties.

Crucially, this is a tax-efficient way to offer appealing perks to your team without increasing payroll costs. Employees stay engaged with added benefits, while you save valuable money that can be redirected toward achieving business goals. With NIC rates increasing, every pound saved through salary sacrifice counts.

In order to effectively take advantage of this, review which benefits you could introduce or expand. Even small adjustments, like additional pension contributions, can cut costs while attracting staff looking for long-term rewards.

3. Review your workforce set-up

With the NIC threshold now lower, the reality is that more of your wage bill is now taxable. As such, now may be the time to consider the structure of your team.

Consider whether certain roles could be done on a freelance, job share or part time basis, or whether certain tasks could be outsourced. By carrying excess staff costs, you could be paying more NIC than you need to.

This isn’ t about cutting jobs. It’ s about making sure your payroll set-up is efficient, flexible and lean. Finding strategic alternatives to reducing headcount, can help you adapt effectively and responsibly.

4. Invest in automation and tech

The reality is that every employee added to your payroll now brings a higher NIC bill. However, technology’ s exponential growth

in capabilities offers huge possibilities in saving money.

Investing in automation or digital tools can cut down on repetitive, manual tasks. This reduces the need for additional hires, keeping your payroll lean whilst increasing the time available to be dedicated to higher value work.

Whether it’ s cloud-based payroll and accounting tools like QuickBooks, or other systems that streamline admin, the right tech can improve efficiency and reduce operating costs.

Now is the time to review your operating processes. Identify the areas where automation could ease workload pressures, explore the technology at your fingertips and make a small investment that will yield both time and financial savings.

5. Offer tax-free perks instead of pay rises

In a similar vein to hiring new staff, pay rises increase your overall NIC bill. Alternatives like share schemes or private healthcare plans do not attract the same tax burden.

These perks can help reward and retain staff without inflating payroll costs. Like salary sacrifice schemes, they show employees

Amy Hancock, Owner, Hancock & Hastings

CRUCIALLY, THIS IS A TAX-EFFICIENT WAY TO OFFER APPEALING PERKS TO YOUR TEAM WITHOUT INCREASING PAYROLL COSTS.

Intelligent SME. tech

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