Benefit conditions – Trivial benefits
19/11/2020

The trivial benefits in kind (BiK) exemption applies to small non-cash benefits like a bottle of wine or a bouquet of flowers given to employees or any other benefit in kind classed as 'trivial' that falls within the exemption.

Although the benefit is defined as ‘trivial’, employers should remember that this offers a great opportunity to give small rewards and incentives to employees. The main caveat being that the gifts are not provided as a reward for services performed or as part of the employees’ duties. However, gifts to employees on milestone events such as the birth of a child or a marriage or other gestures of goodwill would usually qualify.

The employer also benefits as the trivial benefits do not have to be included on PAYE settlement agreements or disclosed on P11D forms. There is also a matching exemption from Class 1 National Insurance contributions.

The tax exemption applies to trivial BiKs where the BiK:

  • is not cash or a cash-voucher; and
  • costs £50 or less; and
  • is not provided as part of a salary sacrifice or other contractual arrangement; and
  • is not provided in recognition of services performed by the employee as part of their employment, or in anticipation of such services.

The rules also allow directors or other office-holders of close companies and their families to benefit from an annual cap of £300. The £50 limit remains for each gift but could allow for up to £300 of non-cash benefits to be withdrawn per person per year.  The £300 cap doesn’t apply to employees. If the £50 limit is exceeded for any gift, the value of the benefit will be taxable.


About Us

We are chartered accountants and registered auditors established in 1946, we have been based in Staplefield near Haywards Heath since 2004. With a client base throughout the southeast, our location is the focal point between Crawley, Horsham and Haywards Heath and Brighton.

Find out more...

Legal

The information contained on this website is provided by Carter Nicholls Ltd for general guidance and is aimed to offer the user general information only. Before making any decision or taking action, you should seek professional advice from a professional from Carter Nicholls or another qualified professional.

Read more....

Contact Us

Carter Nicholls Limited
Victoria House, Stanbridge Park, Staplefield Lane
Staplefield
West Sussex
RH17 6AS

info@carternicholls.co.uk
01444 401440

JUMP TO TOP