Small Benefit Exemption Gift

Small Benefit Exemption Gifts

Employers can provide employees with a small benefit exemption to a maximum value of €500 once in any tax year.

As is the case with many public holidays. Christmas is a popular time for giving bonuses. So as the “season of giving approaches” it is worth ensuring you are up to date on the rules governing this area, most notably the small benefit exemption.

The small benefit exemption cannot be paid in the form of cash or cheques, it must be in a non-cash form, such as a voucher or a hamper.

Where an employer provides an employee with a small benefit the value cannot exceed €500. PAYE, PRSI and USC does not applied to this benefit. However if the benefits exceeds €500 in value then the full value is subject to these taxes. Also, this exemption cannot be applied to the cumulative value of a range of gifts. For example, if you were to gift a €300 voucher early in the year and gift and a further €200 later in the year the exemption could only be applied to one of the two vouchers. It has to be applied as a single gift only once in a tax year.

Employers can save on these small benefit exemption gifts as they do not have to pay Employers PRSI on the benefit. You can also receive a deduction for the small benefit expense e.g. the cost of gift voucher, for corporate tax purposes.

So treat your employees this Christmas tax free to our PaycheckPlus Perfect Card. It is the ideal gift as the user has the freedom to spend their voucher anywhere MasterCard is accepted, unlike other gift-cards on the market which are limited to certain stores.

For more on Small Benefits Exemption Gifts read:

Small Gift Exemption

Tax Exemption Ireland

LQT Exemptions



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