Finance Bill 2016: ‘Trivial’ benefits in kind

Current legislation states that employers are required to report all benefits in kind provided to their employees. There is no minimum cost threshold.

Legislation will be introduced in Finance Bill 2016 so that qualifying trivial benefits in kind are free from tax and national insurance contributions. A benefit in kind will be considered trivial if the cost is no more than £50 per employee. In addition, there will be an annual cap of £300 in respect of benefits provided to directors and other office holders.

The introduction of this new legislation will affect both businesses and individuals positively by reducing the administrative burden placed on employers and by allowing small benefits to be received by employees without creating a charge to tax or National Insurance.