In a Reddit conversation, I discovered something called trivial benefits. How did I miss this? Turns out, UK limited company directors can receive up to £300 a year in tax-free gifts from their company.
The rules are simple:
- Maximum £50 per gift.
- No cash, but gift cards like Amazon are generally fine.
- Cannot be a reward for your work or part of your contract.
- Maximum £300 per tax year for directors of close companies.
So, for example, you could buy yourself six £50 Amazon gift cards throughout the year using your company account, provided they meet the conditions.
I checked with my accountant, InniAccounts, who confirmed it and even added a dedicated category to my accounting software.
Not life-changing, but £300 a year!
If you are freelancing through a UK limited company, it is worth checking with your accountant.
Read the official HMRC guidance.
Happy days!