• Farrell & Farrell

CHRISTMAS GIFTS TO STAFF – Trivial benefits up to £50 non cash gift/voucher

If you are considering giving a Christmas present to your UK employees then why not consider a Christmas hamper, Christmas turkey or a Christmas shop voucher (non cash voucher) up to the value of £50.


Therefore to make it simple this Christmas please feel free to give all staff a Christmas present e.g. hamper, retail shop voucher, etc up to the value of £50. No tax or NIC or P11D reporting is required for such trivial benefits.


CONDITIONS:


• The benefit must be non cash or a non cash voucher. • The cost of providing the benefit must not exceed £50. • It is not provided pursuant to salary sacrifice arrangements or any other contractual obligation, and • It is not provided in recognition of particular services performed by the employee or in anticipation of such services. In essence, is for the goodwill/welfare of the employee rather than reward for services.


E.g. Trivial benefit rules - gift for birthday present, gift for marriage, gift for new baby, Christmas gift, etc.


The business must provide the non cash gift/ non cash voucher to the employee. The voucher must be paid for out of the company funds, e.g. company bank account or company credit card.


If the benefit provided exceeds £50 the full benefit is taxable.


All cash payments are salary and are fully taxable.


Please note that the director/employee cannot purchase the voucher themselves and then seek reimbursement from the company.


A £50 cash payment to an employee could cost the employer over £80 for a basic rate taxpayer. The trivial benefit non cash voucher/present would cost the employer £50 only.


DIRECTORS OF CLOSE COMPANIES – Please note that Directors of ‘close’ companies cannot receive trivial benefits of more than £300 per tax year.


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Farrell & Farrell CA Limited (trading as Farrell & Farrell) is registered in NI with registration number NI 639336. Registered with The Chartered Institute of Taxation as a firm of Chartered Tax Advisers. Registered to carry on audit work and regulated for a range of investment business activities by Chartered Accountants Ireland (CAI). Details about our audit registration can be viewed at www.auditregister.org.uk under reference number 3044856.