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  • Philip Nye

SME's and saving tax


Chatting to an old friend ( a fellow accountant) yesterday he mentioned that he had come across, one of those rare things, a chance to give a benefit to an employee or director which is not taxable. It is known as a "Trivial benefit" . In brief the rules are :-

You don’t have to pay tax on a benefit for your employee if all of the following apply:

it cost you £50 or less to provide

it isn’t cash or a cash voucher

it isn’t a reward for their work or performance

it isn’t in the terms of their contract

For directors of close companies (ltd companies with 5 or less shareholders) cannot receive trivial benefits of more than £300 in a tax year.

I appreciate the sums are not large but anything that is tax free is a bonus?


The link to the HMRC site for full details is here https://www.gov.uk/expenses-and-benefits-trivial-benefits


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