In the Chancellor’s 2018 Budget, new criteria were introduced in relation to Entrepreneurs’ Relief (ER)…
As of 6 April 2016, employers can provide an employee or a member of his/her household with a benefit in kind, with no tax consequences, provided all of the certain conditions are met, deeming the benefit ‘trivial’.
Conditions A to D apply to all employees, whilst condition E applies to an employee that is also a director and the company is close.
Condition A: the benefit is not cash or a cash voucher. A gift card is not classed as a cash voucher so long as change cannot be given.
Condition B: the benefit cost of each gift does not exceed £50 per employee.
Condition C: the benefit is not provided in accordance with any salary sacrifice arrangement or any other contractual obligation.
Condition D: the benefit is not provided in recognition of, or in anticipation of, a particular service performed by the employee as part of his duties.
Condition E: the benefit does not exceed the employee’s annual exempt amount, which is currently £300 per employee.