![]() What do you buy that will really show your appreciation to colleagues, partners and staff? It needs to be business-like, yet memorable and fun too if at all possible. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material can be accepted by the authors or the firm.Corporate Christmas gifts can sometimes be a challenge. It provides only an overview of the regulations in force at the date of publication, and no action should be taken without consulting the detailed legislation or seeking professional advice. Information for readers: This material is published for the information of clients. You can find our latest Tax newsletters and news here. If you would like more information or any advice on how to give gifts to your employees or tax-free staff parties then please contact Ann Bibby on 01295 250401 or email You can also contact us herewith your query and we will get back to you. Officers of a close company can save up to £135 in tax. Your employees can save tax of £10 for basic rate taxpayers and £20 for higher rate taxpayers each time you, as their employer, give them a trivial benefit gift. Therefore, you can still have two parties but both would be tax-free (under different exemptions). ![]() The second event could be covered by the social functions and parties exemption. However, the first event could be covered by the trivial benefits gift exemption as the amount does not exceed the £50 limit. If the limit is exceeded the whole benefit is subject to tax (and potentially NIC). Historically, this would have exceeded the £150 limit for the social functions and parties’ exemption. ![]() The Christmas party costs £45 per head and the summer party costs £150 per head. For example, you hold two functions per year for your employees – a Christmas party and a summer party. You may want to consider combining both exemptions where you hold a number of social functions and you exceed the £150 per employee. is open to all employees (including guests).is an annual staff party or social function for staff, such as a Christmas party or summer social.You can claim for a staff party tax exemption as long as it: It doesn’t have to be just at Christmas either, it can be all year round. In addition to giving your employees a tax-free gift, you can also throw a tax-free staff party. However, where you are a ‘close’ company and the benefit is provided to an individual who is a director or other office holder, the exemption is capped at a total cost of £300 for the tax year.įind out more about tax on trivial benefits on the UK Government website. Gifts of this type are covered by the ‘trivial benefit’ rules and there is no limit on the number of trivial benefits that you can provide, as long as it doesn’t exceed £50 each time. It is important for you to understand that it is not just the excess over £50, but the full amount. ![]() The entire award would be subject to both Income Tax and NIC as the total cost exceeds the £50 limit. For example, an employer awards a £60 John Lewis voucher to their employee for Christmas. If the gift exceeds this value, it will need to be reported to HMRC and will be taxable under the normal Benefit in Kind rules. As long as it costs less than £50 a head, it won’t be taxable. You may wish to give your employees a present, a Christmas hamper, a bottle of wine or even a gift voucher.
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