What Are Trivial Benefits?
“Trivial benefits” are small, non-cash perks that employers can give to staff without creating a tax or National Insurance charge. HMRC’s definition is practical rather than fluffy: a benefit is trivial if it costs £50 or less per person, isn’t cash or a cash voucher, isn’t provided as part of salary sacrifice, and isn’t something the employee is contractually entitled to. If any one of those conditions fails, the exemption doesn’t apply.
Think of them as genuine “thank you” gestures, the kind you’d buy on an impulse to brighten someone’s day, not a reward for hitting targets. Common examples include a birthday bunch of flowers, a small bottle of wine, a seasonal chocolate box, or a meal for a team member who stayed late unexpectedly. HMRC also accepts low-value store or gift cards only if they can’t be exchanged for cash.
Used well, trivial benefits are a simple way to boost morale and retention, especially in smaller businesses where culture matters as much as pay.
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Trivial Benefits for Directors
Directors can receive trivial benefits on the same £50-per-item rules. The key extra wrinkle is for directors of close companies (broadly, companies controlled by five or fewer shareholders). In that case, there’s an annual cap of £300 total trivial benefits per tax year. Go over it and the excess becomes taxable.
So six £50 gifts across the year is fine; a seventh tips you over the limit. This makes planning important, keep a simple log of date, item and cost.
Trivial Benefits for Employees
For employees who aren’t close-company directors, there’s no yearly limit. As long as each benefit meets the conditions, it stays tax-free.
That means you can use trivial benefits regularly for low-cost recognition: welcome packs, one-off “well done” treats, or small seasonal gifts. Just avoid framing them as performance rewards or writing them into contracts, because that would break the exemption.
Trivial Benefits and HMRC
From an HMRC point of view, qualifying trivial benefits don’t need to be put through payroll or reported on P11Ds, which cuts admin for employers.
Two easy compliance tips:
- Stick to the spirit as well as the letter, these are meant for modest goodwill, not disguised pay.
- Keep evidence of cost, especially if buying in bulk. HMRC may allow averaging in some cases, but not all.
Done properly, trivial benefits are one of the few genuinely fuss-free, HMRC-approved ways to say “thanks” while keeping both your team and your tax position happy.
Need clarity on using trivial benefits effectively?
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