I was just wondering what reasons, apart from very obvious like birthday, Christmas, etc., might there be for a trivial benefit? Any thoughts? I am talking about directors in a close company. There are no other employees.
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Any amount that is not cash and is less than £50 but the total is less than £300 in a tax year?
Are you the poster? If you think you already have the answer then why post a question, why not just share it? If you aren't the poster then it is my fault for answering an anonymous query which I don't usually do and you have been caught too.
They don't have to be vouchers.
England beating the Kangaroos, Cricket World Cup, MPs agreeing a Brexit Deal, Gwyl Dewi (topical), St Patrick's Day, St George's Day, St Andrew's Day, Ash Wednesday, Whitsunday - the list is endless.
The conditions appear simple: not cash or a cash voucher; cost £50 or less; not contractual; not in recognition of particular services; and, in the case of directors etc, not more than £300 per tax year.
But the “not contractual” and “not in recognition” tests bear thinking about. I am not an employment lawyer, but I believe there is something about that which is habitual becoming contractual – so I think the “happy first of the month” example might not hold good for very long.
The law doesn’t require a reason for the benefit, and it would be easy to represent HMRC’s request as wrong. But the point is very simple: if it’s neither contractual (or habitual) nor a reward, why are you, the employer, providing that benefit? That, to me, seems a fair question - and HMRC's assumption a fair one.
Just read Tim Good's excellent article in Accounting Web 24/10/2016 it addresses all the issues.