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 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.
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