Christmas Tax Tips
What Is a Trivial Benefit Christmas Gift?
Spread some festive cheer with tax-free gifts for your employees! HMRC’s “trivial benefits” rule allows you to give small, thoughtful presents – such as chocolates, wine, or even a turkey – without triggering tax or National Insurance.
To qualify:
The gift must cost £50 or less.
It can’t be cash or a cash voucher.
It shouldn’t be a reward for work or performance.
These little gestures go a long way in making your team feel valued while staying tax-friendly!
Christmas Parties and Tax Relief
Hosting a staff party this festive season? Keep it under £150 per head (including VAT) to ensure it’s tax-free for your team and tax-deductible for your business.
The £150 limit covers travel, accommodation, food, and drinks, and VAT-registered businesses can reclaim VAT for directors and employees.
Remember, this is an annual limit, not per event. If your summer and Christmas parties combined exceed £150 per head, only one can remain tax-free. Plan accordingly to make the most of this allowance!
Key Takeaways from the Autumn Budget
Employer National Insurance Increase: Rates for employers rise from 13.8% to 15%, though the first £10,500 of Employers NI is now exempt. This benefits smaller businesses but may impact growing businesses.
Capital Gains Tax Changes: Basic rate jumps from 10% to 18%, higher rate from 20% to 24%. Entrepreneurs Relief (Business Asset Disposal Relief) sees tax rates on the first £1M gain rise from 10% to 14% in April 2025 and to 18% in April 2027.
Stamp Duty for Landlords: Additional property purchases now incur a 5% higher rate (up from 3%). This may further deter buy-to-let investments amidst housing shortages.
Inheritance Tax Updates: No changes to current allowances (£325K + £175K for direct descendants) until 2030, but inherited pensions will become taxable from April 2027, encouraging pension spending during retirement.
End of Non-Dom Tax Regime: Non-domiciled tax advantages are abolished, with residence now determining inheritance tax. Expected to raise £12.7BN while aiming to attract global talent and investment.
These changes reflect a challenging fiscal environment with significant implications for small businesses, property investors, and high-net-worth individuals.
Team News
We’re thrilled to welcome Leah to the Richard Riley and Associates family. She will be supporting clients with self assessment returns and will be an account manager for some of our key clients. We’re excited for you to meet her soon.
A big thank you to our incredible team for their hard work, dedication, and humour throughout the year. A highlight for us was our team retreat to Spain in September – a chance to relax, bond, and recharge for another successful year. Here’s to more celebrations in 2025!
Your Complete Guide to Self-Assessment Tax Returns
Filing a Self-Assessment Tax Return can feel like a daunting task, with complex rules and tight deadlines. But it doesn’t have to be. In our latest blog, we share tips, deadlines, and how Richard Riley and Associates can help you navigate the process stress-free while maximising your tax efficiency.