Thursday 14th December 2017

Give Christmas gifts and save tax!

 You can give gifts up to £50 in value to your employees, including directors, without creating taxable benefits. In other words, you can give them a gift and reduce your corporation tax.

The gift must be bought by the company, not refunded to the employee, and it can’t be a reward for any work or achievement. So for example, you can give them a bunch of flowers or a Marks and Spencers gift card for Christmas, and this would be considered a gift. However, if you did the same because they had achieved a target for the month, then this would be taxed as a benefit to the employee.

It can’t be cash, or a voucher exchangeable for cash. There are no limits on the number you can provide to an employee, but there is a limit of £300 worth of gifts a year for each director/secretary and their family.

Further guidance can be found here