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If your employees are all too familiar with jam-packed trains, endless traffic jams and expensive petrol costs to haul themselves to the office daily, providing free bus services could be a clever move.
As well as landing serious brownie points for easing commuter misery, you may dodge a tax bill by meeting home-to-work travel costs.
As an experienced tax advisor, I'd like to explain how the process works and ensure you fully comply with all tax laws and regulations.
Luxury coach or minibus?
You've hit the tax-free jackpot if you can stretch to buying or leasing a coach or minibus for ferrying personnel between home and the workplace. HMRC will keep their mitts off as long as the vehicles have at least 12 or 9 seats, respectively, and the service ticks a few extra boxes.
For starters, the bus provision must generally be available to all staff members, not just higher-ups and favorites. And catering mainly for employees' trips between their front doors and desks should be the prime purpose, rather than occasional excursions to the seaside or football matches.
Moreover, the vehicles must be for more than just staff. Employees' kids under 18 can hitch free rides, too, without scampering tax relief. But be warned, if it's just directors' darling daughters and sons filling seats while workers walk, the taxman may smell a rat.
Nipping to the shops
Delivering personnel right to office doorsteps is optional, too. Short diversions to supermarkets, pubs or other handy amenities are legit, too. If a coach predominantly provides commuter transport, occasional 10-mile detours for lunch breaks or quick shopping are above board.
Need help to stretch buying the buses?
For smaller businesses without capacious car parks, purchasing your armada of vehicles for conveying commuting staff is probably a non-starter. But despair not - you can still fund free workplace travel through cunning collaborations with public transport providers.
The key is tapping up local bus companies and negotiating mutually beneficial agreements. For instance, you could cover some of their costs in exchange for extra routes to your premises or free employee travel passes. Whatever deal you hash out, it obviously can't only benefit your personnel, in any case. Other paying passengers must get the same journey options without discrimination.
As long as the bus company doesn't reserve special treatment exclusively for your lot, the taxman can be kept at bay. Ensure the agreement entitles all staff to free or discounted travel, rather than just the top brass. Contracts catering for particular departments or worker grades are no-go zones attracting HRMC's attention.
Additional administration
Riding to rescue road and rail-weary personnel through bus services, whether your own or outsourced, does mean assuming extra administrative hassles, of course. You'll need to determine optimum routes, draw up schedules, arrange maintenance and manage the expectations of employees and tax inspectors.
Nevertheless, the investment of time and money could pay dividends in terms of corporate reputation and worker loyalty. Judging from many firms now offering shuttle buses from train stations and bus stops, providing that extra transport leg can also make recruitment and retention much easier.
Give it some welly!
Companies need help attracting talent in most areas because commutes gobble up free time and drain pay packets. Providing company buses - especially if they are free for weary commuters - demonstrates you are willing to go the extra mile (or ten!) for workers. With clever arrangements, it might not even dent profits much, thanks to tax breaks.
Of course, organising vehicles and routes is manageable. But when tough commutes disadvantage businesses compared to rivals in leafier locations, sorting transport for the team can transform staff attitudes. Whatever option you pick, supporting workers in spending less time inhaling fumes and more time with families is sure to be appreciated. So what are you waiting for? Make a start on planning new bus benefits now!
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