Trivial employee benefits - a tax free gift.

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Our recent blog talked about P11d’s and reporting for benefits provided to employees by their employer.

Here we discuss Trivial benefits, which are outside the scope of the P11D and can be provided to employees tax free (yes, tax free!).

To be a trivial benefit, the gift must satisfy four key conditions:

  • it cost you £50 or less to provide

  • it isn’t cash or a voucher redeemable for cash

  • it isn’t a reward for their work or performance

  • it isn’t in the terms of their contract

There is no limit on the number of trivial benefits that can be provided to employees each year, as long as each gift satisfies the above conditions and isn’t a larger gift split into multiple payments.

For directors of close companies, there is an annual cap of £300 on the aggregate value of trivial benefits provided to each director in a tax year.

So go on, treat your team…. just make sure the treat meets these conditions!