Ltd company 6 x £50 vouchers as trivial benefits

[belledandy]

I've stumbled across this 'perk' whilst googling about my end of tax year: https://www.reddit.com/r/UKPersonalFinance/comments/ty7s0o/ltd\_company\_directors\_new\_tax\_year\_means\_time\_to/?rdt=40703&onetap\_auto=true

I have my own ltd company with 60% shares and my partner 40% shares.

Am I right in thinking we are both entitled to 6 x £50 vouchers (can not be redeemed as cash)? Can I just buy 12 x £50 vouchers today (i.e. last day of tax year) and distribute them or is it not a good idea to do it like that?

 

[vikuteee9]

@belledandy Yes £300 per director so 6 x £50 each and you can also do a £150 a head Christmas meal

 

[belledandy]

@vikuteee9 Are these not separate things? I thought the yearly entertaining was a different thing.

 

[vikuteee9]

@belledandy yes can do both

 

[bridgetbride]

@belledandy Is your partner performing a contract of service (aka employment duties) or are they just a shareholder?

No you can't provide them all on one day, else what you're providing isn't £50. The general advice is the trivial benefit should be linked to a life event (not given with any regularity or as a reward). It does also need to be different gift cards rather than the same gift card being topped up 6 times (as the value would then exceed £50 and not be able to qualify as a trivial benefit).

https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim21865

 

[daviddass1]

@bridgetbride

The general advice is the trivial benefit should be linked to a life event (not given with any regularity or as a reward).

Where did you even get that?

 

[bridgetbride]

@daviddass1 Well the not given with regularity or as reward are part of the rules for trivial benefits. But linked to a life event is general advice given by accountants (not something I came up with) as it is easy to demonstrate they aren't being given for reward/performance if they're given for a birthday or wedding.

If it isn't as reward for performance (such as working weekends/late, hitting targets, attending a meeting etc) and isn't for a life event, what other trade reason would the employer have to provide the benefit?

The £300 limit on directors of close companies is in recognition that they hold a position where they would be able to abuse the trivial benefit exemption as a way to extract profits tax free.

 

[belledandy]

@bridgetbride She's just a shareholder, I'm the only employee.