TAX-FREE EMPLOYEE CHRISTMAS GIFTS

Andrew McQueen

Andrew McQueen

TAX-FREE EMPLOYEE CHRISTMAS GIFTS


Remember that certain gifts to staff at Christmas are also tax-free if structured correctly. Employers are allowed to provide their directors and employees with certain “trivial” benefits in kind tax-free.

This exemption applies to small gifts to staff at Christmas, on their birthday, or other occasions and includes food, wine, or store vouchers. There are, of course, some conditions that need to be satisfied to qualify for the exemption.

Conditions for the exemption to apply

  • the cost of providing the benefit does not exceed £50
  • the benefit is not cash or a cash voucher
  • the employee is not entitled to the benefit as part of any contractual obligation such as a salary sacrifice scheme
  • the benefit is not provided in recognition of particular services performed by the employee as part of their employment duties