Gifting at Christmas or for other occasions: A simple and easy way to show appreciation.
At this time of year many families seek meaningful ways to demonstrate appreciation for their nanny’s hard work and dedication. One tax-efficient method to consider is providing "trivial benefits." These are small perks or gifts which are permitted within HMRC's guidelines, allowing employers to reward their nannies without incurring additional tax or National Insurance obligations.
What Are Trivial Benefits?
Trivial benefits are non-cash perks provided to employees that meet the following criteria:
· The cost of the benefit does not exceed £50.
· It is not given as a reward for work or performance.
· It is not in the form of cash or a cash voucher.
· It is not part of the employee's contractual entitlement.
Examples for Nanny Employers
Employers can use trivial benefits creatively to show their appreciation for their nanny’s efforts. Examples include:
· A bouquet of flowers or a box of chocolates.
· A gift card for a coffee shop or local store (provided it is not a cash voucher).
· Tickets to a movie or a small experience.
· A festive gift, such as a holiday hamper or seasonal treat.
Key Points
Keep Receipts: Ensure you keep receipts to demonstrate that the cost of each benefit remains within the £50 limit.
Occasional Gestures: Trivial benefits should be occasional and spontaneous rather than regular or performance related.
Know the Limits: Ensure each benefit is independent; the £50 limit applies per gift, not as a cumulative total for multiple benefits.
As the holiday season approaches, small tokens of appreciation like these can go a long way in showing gratitude to your nanny for their work over the year.