Knowledge Centre

You don’t have to pay Benefit In Kind taxes (personal tax and National Insurance) on a benefit for an employee or a director and your limited company can receive Corporation Tax relief if all of the following apply:

• the benefit costs £50 or less to provide

• the benefit isn’t cash or a cash voucher

• the benefit isn’t a reward for work or performance

• the benefit isn’t in the terms of the employee’s or director’s contract

Directors can receive a maximum of £300 in Trivial benefits in a tax year (6 April to following 5 April), which means each director can receive 6 gifts each worth £50.00 or less and not have to pay any personal tax or National Insurance on the gifts and your limited company will receive Corporation Tax relief.

Note - you can not add the £50.00 amounts together to buy one larger more expensive gift, each gift must be a maximum of £50.00.

Examples

• taking a group of employees out for a meal to celebrate a birthday

• buying each employee a Christmas present or birthday present

• flowers on the birth of a new baby

Bookkeeping

You should include all trivial benefits in your 123Books under the expenses category Sundry and enter; Trivial benefit along with what the actual benefit is, in the detail box.