If you’re a small business owner or Director, you might want to reward staff or treat yourself with a small gift now and again. But what does HMRC allow — and where does Tax get triggered?
Enter: Trivial Benefits.
This guide explains what they are, the key rules, and common traps to avoid.
What is a Trivial Benefit?
A Trivial Benefit is a small, tax-free perk that doesn’t count as earnings. But it must meet all of these conditions:
- The cost is £50 or less (including VAT)
- It’s not cash or a cash voucher
- It’s not a reward for work or performance
- It’s not part of a salary sacrifice scheme
If it breaks any of these rules — it becomes Taxable.
Examples of Allowable Trivial Benefits
- A bouquet of flowers to say thank you
- A £30 bottle of wine for a birthday
- A supermarket voucher that can’t be swapped for cash
- A box of chocolates given for no reason
These are all tax-free — as long as the £50 limit isn’t exceeded.
What’s Not Allowed
- Cash or vouchers exchangeable for cash (even part-cash)
- Big ticket items over £50 — even if you think it’s generous
- Performance-based gifts (e.g. “for hitting target last month”)
- Regular or expected gifts (monthly Costa gift card, etc)
- Salary alternatives (e.g. “instead of a bonus”)
What About Directors?
Directors of close companies (i.e. family-run or small companies) can also use the Trivial Benefits rule — but with extra limits:
- Still capped at £50 per gift
- But only 6 gifts per tax year
- Must follow all the usual rules
So yes, you can buy yourself a £45 bottle of whisky and expense it — just don’t do it every week.
Common Mistakes
- Giving a gift worth £51 — and not realising the whole £51 is taxable
- Using a gift card that’s basically cash
- Giving the same staff member the same gift every month
Tip: Keep a simple log of trivial benefits given — who, what, when, and the cost.
Final Thought
Used properly, Trivial Benefits are a great way to show appreciation without tax complications. But they’re easy to misuse. When in doubt, check the rules or get professional advice.
Need help? Book a call with Grace Certified Accountants or subscribe to our YouTube channel for more plain-English tax guidance.