What is a Trivial Benefit?

A Trivial Benefit is a small perk you give to an employee or director that costs £50 or less to provide (including VAT). They’re simple, tax-free, and surprisingly good for morale — which is why they’ve become one of the most popular tools in an employer’s toolkit.

The rules

To qualify as a Trivial Benefit, all four of the following must apply:

• It costs £50 or less to provide (per person, including VAT)
• It isn’t cash or a cash voucher
• It isn’t a reward for work or performance
• It isn’t written into the employee’s contract

If all four boxes are ticked, there’s no Income Tax, no National Insurance, and nothing to report to HMRC. It really is that straightforward.

Practical examples

Trivial Benefits can take many forms. Here are some popular ones:

• A takeaway or pizza for the team on a Friday
• A £50 gift voucher (not exchangeable for cash)
• Wine or chocolates as a Christmas or birthday gift
• Flowers to celebrate the birth of a new baby
• Taking employees out for a meal to mark a birthday or work anniversary
• A small team celebration that falls outside the annual staff party £150 exemption

The key advantages

1. Generous allowance — Employees can receive Trivial Benefits worth up to £300 per year in total, with each individual benefit capped at £50.
2. Zero tax or NI — Because the amounts are small, they’re fully exempt.
3. No reporting to HMRC — No P11D, no paperwork, no admin headache.
4. Flexible and spontaneous — There’s no need to include Trivial Benefits in employment contracts. Give them when you feel like it.
5. Great for wellbeing — Think running trainers, a yoga class, or a therapy session. As long as each one costs £50 or less, it counts.

A note for directors

If you’re a director of a close company (typically a small, owner-managed limited company), the same rules apply — but your total annual Trivial Benefits allowance is capped at £300 across all benefits received. Still a very handy perk.

Need help making the most of your allowances?

If you’d like to make sure you’re claiming everything you’re entitled to, get in touch — we’re always happy to help.