It’s less than 2 weeks to Christmas! So we thought that you might appreciate a seasonal reminder of what you can and cannot do without tax or NIC to spread a little Christmas cheer amongst your staff.
Firstly you can give them a gift. To be tax and NIC free, the gift must be ‘trivial’. Helpfully, there is no definition of what this means. HMRC guidance notes accept that things like a box of chocolates, a turkey or a couple of bottles of wine would qualify.
Cash payments and vouchers can never be classed as trivial benefits, no matter how small. However, should you choose to give vouchers, you can still arrange to pay the tax and employers national insurance on behalf of your employee by a PAYE settlement arrangement – we can help you do that.
Staff annual functions (e.g. a dinner dance or Christmas party) are tax-free where the total cost per person attending is not more than £150 per year (including VAT). If you invite couples, that’s £150 each person. Watch out though – if the cost goes over £150 then the whole lot is taxable. Make sure you include things like taxi costs in your calculations to check whether you are under the limit.
For more information call Julie Walsh on 01254 679131 or email firstname.lastname@example.org