Budget 2013: The government is to introduce tax relief on up to £500-worth of health-related interventions funded by employers in a move designed to tackle long-term sickness absence and help staff return to work.
As announced in January 2013, it is creating the health and work assessment and advisory service, targeted at those at risk of long-term sickness absence.
The new targeted tax relief, announced by Chancellor George Osborne in the 2013 Budget, will apply to health-related interventions recommended by the service, so these are not treated as a taxable benefit in kind.
The government will consult on the implementation of the tax relief later in 2013.
James Freeston, sales and marketing director at Axa PPP Healthcare, said: “We welcome the government’s decision to introduce targeted tax relief [of] up to £500 paid by employers for treatment of ill or injured workers, to speed their recovery back to health and back to work.
“It’s a big step in the right direction and shows the government’s commitment to the principle that, by and large, work is good for people, for their families, for business and for society.”
He added: “The change should encourage employers to work in partnership with employees and healthcare providers to play a bigger part in improving management of sickness absence, and in cutting the needless flow of people out of work and on to ill-heath-related benefits.
“We know from experience that targeted rehabilitation cover that pays for treatment of employees, whose illness or injury is stopping them from doing their job, can expedite their recovery and return to work – especially employees affected by two of the main causes of long-term sickness absence: musculoskeletal disorders and psychological problems such as stress, anxiety and depression.”
Katharine Moxham, spokesperson at industry body Group Risk Development (Grid), added: “We are pleased the government has recognised that interventions targeted at minimising absence, or speeding employees’ return to work, should be encouraged rather than penalised [because] they provide much-needed support for employees, as well as saving both employers and the State significant amounts of money in the longer term.
“Financially astute employers will, of course, continue their health, wellbeing and support programmes to ensure return on investment plus an incentivised, productive and well-supported workforce, but relief on interventions will encourage many more employers to consider such programmes.
“The government has clearly recognised the crucial role of the employer in helping employees return to work as quickly as possible, and that additional support is needed to help them facilitate this.”