11. Entertaining

See also:

11.6 Gifts to staff

(a) Gifts to employees

Technically, all gifts or benefits provided to employees are subject to income tax and National Insurance unless there is a specific exemption. HMRC take a pragmatic view of benefits of a trivial nature, however, and do not normally consider these to be taxable as long as the following conditions are met.

Conditions for treating trivial gifts as non-taxable:

  • The gift is not in the form of money, vouchers or tokens; and
  • The total value of the gift does not exceed £50; and
  • The gift is not given frequently.

Allowable examples of gifts that may be treated as tax-free are:

Examples of trivial gifts that may be treated as non-taxable:

  • Flowers or chocolates to mark a special occasion;
  • An ordinary bottle of wine;
  • Seasonal gifts (such as turkey or Christmas pudding, etc).

Any gifts that do not meet the criteria for being tax-free must be treated as taxable and reported via the P11D process.

Staff responsible for arranging gifts should be aware of the rules relating to the giving of gifts within Financial Regulations and in the Gifts & Hospitality Policy.

Long-service gifts to staff on retirement are dealt with in section 5.2.

(b) Gifts to individuals who are not employees

Gifts provided to individuals who are not employees of the University (students, visitors, etc.) may be taxable if they are deemed by HMRC to be provided in return for services, or are of a significant value.

In general and for simplicity, the rules for other gifts to employees should be applied equally to non-employees. Further advice on specific cases may be sought, however, from the Payroll Manager.