Employers can provide trivial benefits to employees without incurring tax liabilities.
To qualify as a trivial benefit, a number of conditions must be met which are that the:
- Cost of providing the benefit does not exceed £50
- Benefit is not cash or a cash voucher
- Benefit is not provided under salary sacrifice arrangements or any other contractual obligation
- Benefit is not provided in recognition of particular services performed by the employee in the course of the employment or in anticipation of such services
In addition, where qualifying trivial benefits are provided to directors and other office holders of ‘close’ companies, they will be subject to an annual cap of £300. Where the benefit is provided to a member of the employee’s family or household who is not an employee of the employer, this benefit will count towards the £300 exempt amount. Where the director’s or other office holder’s family or household member is also an employee of the company, they will be subject to a £300 cap in their own right.
Trivial benefits do not need to be reported on a P11D form and are exempt from income tax and National Insurance.
Please contact us for advice on how the exemption operates.
HMRC has published new advisory fuel rates for company car users which take effect from 1 December 2023. Advisory fuel rates have increased by 1p for petrol cars with an engine size of 1400cc or less and over 2000 cc. LPG fuel rates have increased by 1p in for engines...
As a self-employed business owner, you may find it hard to keep on top of tracking accounting records, taxes and expense claims when submitting your self-assessment tax return. Hiring an accountant could benefit you with the following points. There are many different...
Autumn Statement 2023 On 22 November 2023, Jeremy Hunt delivered the ‘Autumn Statement for Growth’. Against an improving economic backdrop, the Chancellor is keen to stimulate economic growth and highlighted 110 measures for businesses. In addition, there were...