What is flexible benefit package?

What is flexible benefit package?

A benefit program that offers employees a choice between various benefits including cash, life insurance, health insurance, vacations, retirement plans, and child care.

What is included in flexible benefit plan?

In India, Flexible Benefits Plan (FBP) in salary structure is a facility for employees in which they can modify components of CTC (Cost to Company) such as medical expenses and conveyance. CTC contains all the elements of salary; HRA (House Rent Allowance), Medical Expenses, Basic Salary, DA (Dearness Allowance), etc.

What is flexible allowance?

Income tax rules specify that certain allowances that are paid by employer and attributed to business needs are exempt from income tax. These are popularly known as Flexible Benefit Allowances (or flexi allowances). The tax rate applicable is 5% and hence the tax payable would be Rs. 20,000.

What are the potential advantages of flexible benefits and flexible spending accounts?

Flexible spending accounts (FSAs) are a type of benefit that is designed to save employees money via pre-tax savings on healthcare expenses. Offering flexible spending accounts may help businesses attract top candidates and increase retention and satisfaction among existing employees.

What companies offer flexible benefits?

10 Forward-Looking Companies Offering Flexible Work

• American Express. American Express, one of the largest credit card companies in the world, has adapted to a more flexible scheduling model for its workers despite it having more than 50,000 employees globally.
• Automattic.
• Dell.
• InVision.
• UnitedHealth Group.
• Zapier.

Why are flexible benefits plans important?

Flexible benefit plans allow employees to choose the benefits they want or need from a package of programs offered by an employer. In a flexible benefit plan, employees contribute to the cost of these benefits through a payroll deduction of their before-tax income, reducing the employer’s contribution.

Will opting for a flexible benefit plan in salary reduce the take home pay?

In simple words, it reduces your taxable salary by submitting proof of expenses for the mentioned flexi pay amount. Some employers pay the benefit amount upfront and ask for receipts of the same at the financial year end. Income tax is deducted if employee fails to submit the same.

How do I create a flexible benefit plan?

How to declare Flexible Benefit Plans in Zoho Payroll

1. Enter your planned expenses under each eligible category.
2. If a component is marked as restricted, then, you can either claim the maximum FBP amount (specified by the employer) or exclude the FBP component itself.