This website uses cookies to ensure you get the best experience. Please read our policies for more information.

10 Chartered Accountants

News

Trivial in name only – do you know the rules on trivial benefits in kind?
04 April 2017

Although designated as ‘trivial’ by the taxman, trivial benefits in kind can result in tax savings for you and your employees, which can be anything but trivial.

The rules cover benefits such as taking employees out for meals or giving gifts at Christmas – costs which can quickly add up and might, over the course of the year, attract a hefty tax bill.

New rules introduced a year ago overhauled the procedures for taxing trivial benefits in kind. The reforms mean that any benefit that meets the following criteria set out by HM Revenue & Customs is exempt from income tax and national insurance:

  • The cost of providing the benefit does not exceed £50 (or the average cost per employee if a benefit is provided to a group of employees and it is impracticable to work out the exact cost per person);
  • The benefit is not cash or a cash voucher;
  • The employee is not entitled to the benefit as part of any contractual obligation (including under salary sacrifice arrangements); and
  • The benefit is not provided in recognition of particular services performed by the employee as part of their employment duties (or in anticipation of such services).

The rules differ slightly for office holders of the company, family members and members of the household. In these cases the exemption is capped at £300 in total for the tax year.

If you are satisfied that benefits provided to your employees meet the definition of a trivial benefit in kind, then you do not need to include them on a P11D.

Link: Tax exemption for trivial benefits in kind

Other recent news

Fur and finance – Tax compliance in animal sales
12 February 2025

If breeding and selling animals has turned into a source…
Read more

Optimising your credit control policies to deal with chronic late payers
12 February 2025

Despite repeated calls for reform, the Government has shown little…
Read more

Budgeting for the unknown – Contingency strategies and tips for businesses
12 February 2025

No matter how well-prepared you may think you are, things…
Read more

How to capitalise on the Government’s AI push
12 February 2025

In January, the Government unveiled its Artificial Intelligence (AI) Opportunities…
Read more

Received a ‘One to Many’ letter recently?
12 February 2025

HM Revenue & Customs (HMRC) has recently issued One to…
Read more

»

Case Studies