ATT Budget Representation - Reforming tax relief for trivial benefits

The ATT has submitted a Budget Representation calling for the trivial benefits exemption to be amended.

We noted that both the £50 limit on benefits that can be covered by the exemption and the annual total £300 cap on benefits provided to directors and their households/families, have remained unchanged since the exemption was first introduced in legislation in 2016. This means the exemption no longer covers many types of expenditure originally intended.

To take account of increased in inflation, we recommended that the government increase the £50 trivial benefits limit to £70 and increase the £300 cap on benefits provided to directors and their households/families to £425 per tax year.

We have also suggested that, where a benefit would qualify for relief under the trivial benefits legislation if it had paid for directly by the employer, it should also qualify when an employee pays for the benefit personally and is then is reimbursed. The current lack of consistency creates an unfairness, as well as creating unnecessary complexity in the tax system.