Gifts – As of 6th April 2016, “trivial” benefits up to the value of £50 are tax and N.I. free.This covers gifts to your staff such as a bottle of wine, chocolates, flowers etc. However, cash gifts and gift vouchers are excluded from this.

Entertainment – You can pay to entertain your staff up to £150 without causing them a tax liability.  This limit will include the Christmas party, the summer barbeque and any other similar functions. Once you spend over £150 per year per head, the whole amount becomes taxable, not just the amount over £150 so be careful. The £150 limit also applies to guests attending, which makes the limit £300 if a member of staff brings their partner! This limit is additional to the Trivial Gifts limit. 

Staff Uniforms – Providing your staff with a uniform has always been accepted as having no taxable benefit if used only during work. If used at outside work, it should include a permanent employer logo or badge otherwise it may become taxable. If you need to provide Doris with a jacket to meet health & safety requirements during work, then it is not a taxable benefit.childcare vouchers.

Lunchtime Meetings – If you provide food and drink to your staff over a lunchtime meeting, this may be taxable. For the lunch to be provided tax free, it must be available to all members of staff so make sure everyone receives a meeting invitation, or at the very least that the leftover food is shared by everyone else.

Gift Vouchers – Providing gift vouchers to your staff is unfortunately taxable one way or another. You can either declare the vouchers on each employee’s form P11D so that they pay the associated tax and national insurance or you can set up a ‘PAYE Settlement Agreement’ with HMRC which will arrange for the tax and national insurance bill to be sent to the employer.

Cycle to Work Scheme – Why not encourage your staff to cycle to work? Not only will it keep them fit and healthy but it is also good for the environment. Even HMRC think this is a good idea and subsequently allow employers to provide their staff with bicycles – tax free! After 12 months, employees can purchase the bicycle from their employer at the ‘market value’ which can be anything as low as 5% of the original cost. Employees therefore acquire bicycles at bargain prices, with the employer claiming full tax relief on the net cost to them.

Mobile Phones – You may provide each member of staff with a mobile phone tax free. This could be used to reduce their salary by the appropriate amount then provide the phone and therefore save the associated tax and national insurance.

Computers / Tablets – You could also provide your staff with a computer or Tablet. HMRC will not tax your staff providing that they are used mainly for business purposes with any private use being insignificant. This does not apply to mobile phones which can be provided tax free even when there is no business use.

Cash Bonuses – If you treat your staff to a cash bonus this must be put through the payroll and the appropriate tax and national insurance must be deducted