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Finding ways to make your limited company’s money go further is always satisfying and thanks to the changes to trivial benefits, this just got easier. If you’re looking for guidance about what trivial benefits are or how you claim, give our handy guide a read.
Since 6th April 2016, a company can provide employees and directors (not shareholders) with ‘trivial benefits’ which cost up to £50 a time, with no tax or National Insurance implications. For contractors working via a close company (a limited company that’s run by 5 or fewer shareholders), there is a £300 annual cap for these trivial benefits.
There is no limit on the number of ‘benefits’ provided, as long as they do not exceed £50 at a time, or £300 in total over the year. For example, there could be 6 claims of £50, or 30 claims of £10. If any ‘benefit’ exceeds the £50/£300 limits, they are no longer allowable via the business. You don’t need to pay tax or National Insurance or let HMRC know.
As long as you meet the following criteria, you won’t need to won’t need to pay tax:
Since the rules changed, there are also certain things which can no longer be claimed:
Finding the best advice about your finances as a contractor isn’t always easy. At Nixon Williams, we’re here to make life as easy as possible for you. Whether you’re looking for ongoing support with your accounts or advice about expenses, we can help.