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HMRC internal manual

Employment Income Manual

Particular benefits: exemption for trivial benefits – conditions to be satisfied - cash and cash vouchers (from 6 April 2016)

Section 323A(3) ITEPA 2003

Note: this guidance has effect for benefits provided from 6 April 2016 onwards. For guidance on HMRC’s approach to trivial benefits for tax years 2015 to 2016 and earlier, see EIM21860.

The guidance at EIM21864 sets out the qualifying conditions that determine whether or not a benefit provided to an employee is exempt from tax as a trivial benefit.

One of the conditions that has to be satisfied before the trivial benefits exemption can apply is that the benefit is not cash or a cash voucher. However, benefits provided in the form of a non-cash gift voucher can be covered by the exemption.

Example G

Employer G provides each of its employees with a bottle of wine costing £25 at Christmas. However, as an alternative, it provides employees who do not drink alcohol with a £25 gift voucher for a national supermarket chain which they can exchange for an alternative non-alcoholic Christmas gift. Both the bottle of wine and the non-cash gift voucher can be covered by the exemption.

Cash and cash vouchers should not be treated as exempt from tax as trivial benefits, regardless of how small the cost.