Tax Free Food? Are your Staff Missing a Benefit?

For some time now staff restaurants in the business and industry sector have been seen as a tool of staff retention: the way to a worker's heart is through her (or his) stomach. Give them a superior lunch and they'll give you loyalty. But foodservice consultancy Tricon says lots of businesses are missing a trick that delivers an additional and significant salary benefit: income-tax-free food.

"There may be no such thing as a free lunch, but the 'income-tax-free-lunch' is alive and kicking and waiting to be used," says Tricon's Tony Horton. "It's all about salary sacrifice. Members of staff agree to give up, say, £1000 a year in salary. That money is then put on their account and they can use it to buy food in the staff dining facilities. There's no income tax to pay - so for higher rate tax payers, they are effectively gaining £400, albeit to be spent on food."