Tax-free vouchers are a great way to pay staff a bonus for Christmas and can boost local retail economy too. The rules on tax-free vouchers for 2017 remain unchanged. However, you need to buy the vouchers – up to the value of €500 – before the end of the year.
If you are an owner/director of your own business, and your spouse is also an employee/director, then you can double that benefit to €1,000.
If cash flow is not a major issue for you at present, then now is the time to buy. This is why this benefit works so well as a Christmas bonus. If you’re in business with a partner, and both of you have spouses as directors/employees of your company, then you are looking at €2,000 in tax-free benefits!
The background to tax-free vouchers
Last year, the threshold was doubled from €250 to €500 for this measure. This is often used by companies to give their workers Christmas bonuses of shopping vouchers. It’s particularly popular with owner/managers of small businesses who are directors of their own business. This is because so many also have a spouse who is also an employee/company director of the business. From the point of view of business owners, the scheme has some great advantages.
To sum up, tax-free vouchers are:
· A tax-efficient way of rewarding your staff
· As the benefit is only tax-free for one single payment, they are ideal as a Christmas bonus
· It’s a double win for owner/managers who are directors/employees of their business and whose spouse is also a director/employee – they could benefit from up to €1,000 tax-free….
To find out more about the tax-free vouchers scheme, check out these FAQs from the Revenue Commissioners here.
At Accountant Online, we offer accounting services for new startups that aim to meet your compliance obligations, while also keeping costs low.
Accountant Online is a firm of award winning Chartered Accountants serving Ireland and the UK. We understand how important it is for you to meet your compliance obligations, while minimizing your tax liability. We aim to save our clients money without compromising on the quality of our service. Get in touch for a free consultation on 01 905 9364 or send an email to firstname.lastname@example.org