AFM calls for P11D charge to be removed from workplace health cash plans

The Association of Financial Mutuals has called on the Government to remove the P11D charge applied to workplace health cash plans.

The call forms part of AFM’s newly published strategy, Closing the Gaps: Building Financial Resilience, which sets out how mutuals can help support financial resilience, economic inactivity, rehabilitation, consumer health and wellbeing.

AFM said health cash plans can help employees meet the cost of everyday healthcare, including dental care, eye tests, physiotherapy and other routine treatments.

The association argued that this type of support can help people address health issues earlier, rather than waiting until conditions worsen and affect their ability to work.

AFM warned that the current P11D treatment can discourage employees from taking up employer-sponsored schemes.

The strategy said health-related economic inactivity now costs the UK economy an estimated £212bn a year in lost output, equivalent to 7% of GDP.

AFM said removing the P11D charge would reduce barriers, improve take-up of workplace health plans and help ease pressure on NHS services.

The association said mutual providers were well placed to support the Government’s Keep Britain Working review through accessible, community-focused health and wellbeing products.