Bright ideas. Your flexible benefits 2014/2015

Transcription

1 Bright ideas Your flexible benefits 2014/2015

2 Your flexible benefits 2014/2015 As an Electricity North West employee, Bright Ideas gives you the opportunity to shape your own benefits package to meet your individual needs and lifestyle whilst at the same time making valuable tax and National Insurance savings. Welcome to the Bright Ideas flexible benefits scheme This brochure details the benefits on offer this year and includes a step by step guide to making your selections. The flexible benefits on offer this year are: Breakdown cover Buy or sell holidays Childcare vouchers Dental insurance Cycle to work scheme Pension Saver To take part you must choose your benefits during the annual enrolment window which runs from 20 January 2014 to 7 February If you want to take advantage of the benefits on offer it is important that your completed enrolment form is returned to HR Services by Friday 7 February Your selections will then take effect from 1 April 2014 and will be contractually binding for the 12 months to 31 March However, in the event of a relevant lifestyle change there may be an opportunity for you to change your flexible benefits during the year. What counts as a lifestyle change? birth or adoption of a child getting married, entering into a civil partnership or gaining a dependant partner (co-habiting for at least six months) divorce or separation redundancy or loss of employment of your partner death of a spouse or partner The lifestyle change must be relevant to any request to change a benefit during the year. If you need any further help please contact HR Services, you can find their details on the inside back cover. Best wishes Fiona Brown Head of Pensions & Reward

3 How does Bright Ideas work? The Bright Ideas flexible benefits scheme allows you to choose the benefits you want from the options available. You can review your choices each year. Breakdown cover, childcare vouchers, dental insurance and pension saver are continuous and will automatically renew each year unless you cancel them. The Cycle to work scheme will run for a 12 month period. If you want to buy or sell holidays you will need to re-select this each year. Some of the benefits work via a salary sacrifice agreement. Salary sacrifice works by allowing you to give up part of your salary in return for some form of non-cash benefit. This in turn reduces the amount of tax and/or National Insurance that you have to pay. Any benefit you choose which affects your salary will form part of your contract of employment. However, any bonuses, overtime or pension benefits you receive won t be affected by the benefit choices you make. You can t salary sacrifice benefits that reduce your pay below the level of the national minimum wage. Who can apply? All our permanent and fixed term contract staff are eligible for these offers, subject to any terms and conditions of our suppliers. So what s on offer? Turn over the page to find details of the benefits on offer for the 2014/2015 benefit year. If you need further information please read the Fast facts and the suppliers terms and conditions, which can be found in the Reward and Benefits section on the Volt and also on the company website (

4 Breakdown Cover A way to keeping you moving BENEFIT PROVIDER: AA As part of your flexible benefits the AA can help to keep you and your family moving with a range of AA roadside assistance membership options. The AA are offering up to 30% off their normal breakdown cover each year for as long as you want to remain a member. All annual membership costs will be deducted as a one-off payment at the start of the scheme year (April 2014). Product Membership You pay Saving ROADSIDE This basic level of cover provides roadside assistance throughout the UK, 24 hours a day, 365 days a year. The AA s number 1 aim is to fix your car, but if it can t be fixed it will be taken to the nearest suitable garage. Single Joint Family ROADSIDE & RELAY Recovery to a single destination of your choice within the UK if the AA is unable to fix your car at the roadside or arrange a prompt local repair. You can choose to be taken home, to your destination or anywhere else in the UK, regardless of how far this may be. ROADSIDE, RELAY & HOME START 1 in 4 breakdowns happen at or near home and Home Start gives you assistance in these situations. You ll get all the benefits of Roadside assistance at your home address. Single Joint Family Single Joint Family ROADSIDE, HOME START & STAY MOBILE If you break down and the AA can t arrange a prompt local repair, Stay Mobile offers you other travel options. You can choose from public transport costs, overnight accommodation or a replacement car for up to 72 hours. Single Joint Family NOTE: This benefit will automatically renew at each enrolment period unless you tell us otherwise.

5 Buy or Sell Holidays A flexible approach to your annual leave BENEFIT PROVIDER: Electricity North West Through flexible benefits you have the option to buy or sell holidays, giving you a flexible approach to your work life balance. By taking up this benefit you can vary the amount of annual leave you can take during the holiday year (01 April March 2015). You can buy up to five extra days or sell up to two days, as long as your holiday entitlement does not go above the maximum of 35 days or below the minimum of 25 days. Each day of leave that you opt to change is priced at 1/260th of your notional salary. If you choose to buy holidays you will not pay tax and National Insurance on this benefit. Part time employees can buy holidays in hours up to the equivalent of their contractual weekly hours.

6 Childcare Vouchers Childcare Vouchers really do reduce the cost of childcare! BENEFIT PROVIDER: Fideliti If you re a working parent with children under the age of 16 flexible benefits allows you to save on the cost of your childcare. You can select up to a maximum of 243 worth of vouchers each month (or 55/week if you are paid weekly) depending on your tax band at entry. From 06 April 2013 all employees eligible to join the scheme will be entitled to the following childcare vouchers. Tax Band Basic rate tax payer (20%) Higher rate tax payer (40%) Additional rate tax payer (50%) Childcare Voucher Entitlement Up to 55 per week/ 243 per month Up to 28 per week/ 124 per month Up to 22 per week/ 97 per month Employees who joined the childcare voucher scheme before the 6 April 2011 are unaffected by the changes from that date. Childcare vouchers are tax free and exempt from National Insurance contributions up to your entitlement limit. Both parents are entitled to childcare vouchers, so a family could save between 933 and 1,866 per annum. Childcare vouchers can be used to pay for the following forms of registered childcare: day nurseries, childminders, nannies, au pairs, before and after school clubs and even holiday clubs. You can choose to receive your vouchers electronically or have them automatically transferred to your chosen childcare provider. NOTE: This benefit will automatically renew at each enrolment period unless you tell us otherwise.

7 Dental Insurance A little something to keep you smiling BENEFIT PROVIDER: National Dental Plan (NDP) This benefit offers a contribution towards necessary dental treatment, from check ups to more complex procedures (such as crowns and bridges). There are three levels of cover available and it can be used to insure you, your spouse/partner and children, if appropriate. You should compare your own dentist s charges to the reimbursements shown below and in a fuller benefits schedule available on the Volt, to ensure you choose the most appropriate plan for your needs. Monthly Premium Level of Cover Clear 1 Clear 2 Clear 3 Employee only Employee & partner or children Employee, partner & children Important information: Clear 1 - reimburses 100% of NHS dental fees up to an annual maximum of 550 for routine treatment and a maximum of 550 for accident / sports injuries. Clear 2 - reimburses towards low range private dental fees with annual maximum of 950. Clear 3 - reimburses towards mid-range private dental fees with annual maximum of 1,250. What all NDP plans include: A free choice of dentist, either NHS or private. No dental checks required prior to acceptance. All pre-existing conditions covered (except oral cancer). Immediate cover - all necessary treatment, including an existing course of treatment, is covered from day one. Simple claims procedure and prompt, accurate claims payment usually processed within 5 working days. A generous claims period of 90 days. Please note Partners and/or child/ren must be covered at the same level as you. The maximum benefits set out in the benefits schedule may be claimed separately for each insured adult and for all insured children taken together. Pregnant women and women with children under the age of one are eligible for free dental treatment under the NHS. Children are entitled to free NHS dental treatment under the age of 18yrs (or 19yrs in full-time education), but you may wish to claim for treatment received privately. Children can be included up to the age of 21 (or 23 if in full-time education). Making a claim You will receive a certificate of cover and claim form when you join. You can claim for necessary treatment received after the cover start date and will be reimbursed up to the amounts shown in the benefit schedule, up to the overall annual maximum. When your treatment has finished, you pay the dentist in the usual way and have your form completed at the surgery. You then attach a receipt for the amount you have paid and send the form to the claims address. NOTE: This benefit will automatically renew at each enrolment period unless you tell us otherwise.

8 Cycle to work Stay fit and save money BENEFIT PROVIDER: Halfords How does it work? Within the Government s Green Transport Plan, there s a tax exemption which allows employers to provide cycles and safety equipment to employees as a tax-free benefit. The employer buys the bikes and safety accessories at full retail price, including VAT which is reclaimed in the normal way, if applicable. The balance is recovered from a reduction in the employee s gross wages (salary sacrifice). Payments will be deducted over 12 months. The employer owns the cycle and accessories and technically hires them back to the employee, initially for a 12 month period. What is a salary sacrifice? A salary sacrifice means giving up part of your salary in exchange for a non cash benefit; in this case, the bike and safety accessories. At least 50% of the bike s use must be for work purposes. The notes on the Volt explain these HRMC requirements in more detail is the maximum you can spend! You can spend anything from 100 up to a maximum of 1,000 on a bike and accessories. This can work out to as little as 5 per month. Example Retail Price Basic Rate Taxpayer 20% Tax, 11% NI Income Tax and NI Saved Net Monthly Payments Total Cost of Bike Package % Savings over 12 months 31% 31% 31% Higher Rate Taxpayer 40% Tax, 1% NI Income Tax and NI Saved Net Monthly Payments Total Cost of Bike Package % Savings over 12 months 41% 41% 41%

9 Pension Saver A valuable way to save you money BENEFIT PROVIDER: Electricity North West Pension Saver allows you to make your pension contributions in a more cost effective way. The scheme is open to all pension members. Under Pension Saver the Company will pay pension contributions for you and in return your salary will be reduced by the same amount. This will result in you paying less tax and National Insurance and so increases your net pay. All eligible employees are automatically entered in Pension Saver if they join the company pension scheme at the same time as they join the company. If you join the pension scheme as part of the automatic enrolment legislation you will not be automatically entered into Pension Saver. You can tell if you are in Pension Saver by looking at your payslip. If you feel this is not a valuable benefit you can opt out during the flexible benefits enrolment window. If you have previously opted out this is your opportunity to re-join. NOTE: This benefit will automatically renew at each enrolment period unless you tell us otherwise.

10 Tax Implications Under current tax law and legislation some, but not all, benefits are taxable as remuneration. If benefits are provided to an employee (or members of their family/household), HMRC generally regard these as part of their reward for doing their job. To qualify and benefit from the tax and National Insurance savings you should ensure that your annual salary is above the national minimum wage. The table below shows the tax and National Insurance treatment for our 2014 flexible benefits scheme. Benefit Employee s tax Employee s National Insurance P11d* Breakdown cover Buy or sell holidays Childcare Vouchers Dental Cover Cycle to work Pension Saver Taxed in the following year as a benefit in kind on the value of the benefit received. There will be no tax charge if buying holidays. Any cash received from the sale of holidays will be subject to tax. Not liable to tax for the voucher amount selected up to the tax payers entitlement rate. Taxed in the following year as a benefit in kind on the value of the benefit received. Not liable to tax on the value of the contribution. Not liable to tax on the value of the contribution. Not liable to National Insurance. There will be no National Insurance charge on the value of holidays bought. Any cash received from the sale of holidays will be subject to National Insurance. Not liable to National Insurance on the voucher amount selected up to the tax payers entitlement rate. Not liable to National Insurance. Not liable to National Insurance on the value of the contribution. Not liable to National Insurance on the value of the contribution. * P11d is the form which declares any benefits in kind received. The company prepares this form for you, as applicable. This P11d information is included in the calculation of your tax code to be used in the following tax year. Using this method any tax due in respect of the flexible benefits chosen in one tax year is recovered from your pay in the following tax year. The flexible benefits that incur this tax charge are indicated in the table above by a Yes in the P11d column. Yes No No Yes No No

11 Making your choices - what you need to do Making your benefit choices couldn t be easier, simply follow the step-by-step guide below. You will be able to select your benefits during the annual enrolment window that runs from Monday 20 January to Friday 7 February. Step 1 Reviewing the benefits on offer Simply take the time to review the benefits that are on offer this year. As well as this brochure, you can find more information in the fast facts and the suppliers terms and conditions on the Volt. Step 2 Making your choices Following a review of the benefits on offer, if you want to make any benefit choices it is important that you complete the enclosed Flexible Benefits Enrolment Form. Completing the form couldn t be easier. Just tick the box next to the benefits you wish to select, complete any additional information required relating to those benefits, then sign and return the completed form to HR Services. If you would like to complete the form electronically, you can download a copy from the Reward and Benefits section on the Volt, or the company website at Step 3 - Submitting your form Once you are happy with the benefits you have chosen it is important for you to return your form to HR Services by 7 February 2014*. By post: HR Services, Electricity North West, 304 Bridgewater Place, Birchwood Park, Warrington, WA3 6XG By HRServices@enwl.co.uk By doing this you are confirming that you are happy for your benefit choices to be processed and for the deductions to be made in line with the scheme rules. *If you have chosen childcare vouchers you must also complete the salary sacrifice agreement, which is included in this pack, and return it to HR Services by 7 February Step 4 - Confirming your selections On receipt of your form and following the annual enrolment period closing date, we will review and approve your selections in line with the scheme rules. Confirmation of your benefits will be sent to you before the start of the 2014 flexible benefits year.

12 Your Flexible Benefits Help Please remember that to take part in the 2014 flexible benefits scheme you must make your choices during the enrolment period. Your choices will then take effect from 1 April 2014 and will be contractually binding for the 12 month benefit year. If you need any further help please contact HR Services: HRServices@enwl.co.uk Phone: (Option 1) (Monday to Friday, 9am to 5pm) You can also find more information on the Volt: Working here > Reward and benefits > Your benefits or the company website ( Reward and benefits > Your benefits Electricity North West Limited, 304 Bridgewater Place, Birchwood Park, Warrington, WA3 6XG Registered in England and Wales Registered Number /14/SD/5986a