Question on vouchers

Lynfo

The MD here wants to give staff €250 in vouchers at Christmas which I understand are non taxable.

Can he also give himself and the other proprietary director the same tax free voucher?

And also, both directors have wives in the company, and one has a son who works here, are they also entitled to tax free vouchers?

seamus

From what I can tell, any such voucher is not tax free for the directors or their spouses.

The director's son gets it tax-free if he is ordinarily subject to PAYE.

barneystinson

seamus wrote: »

From what I can tell, any such voucher is not tax free for the directors or their spouses.

The director's son gets it tax-free if he is ordinarily subject to PAYE.

Do you have a source for that?

I don't know for definite myself, but Revenue's guide to BIK says:

"Use of terms 'employees' and 'PRSI' in this guide:
All references in this guide to 'employees' include references to directors unless otherwise stated. In addition, references to 'PRSI' include references to Employers' PRSI and to the Health Contribution."

The same guide then states:

"Small benefits
Where an employer provides an employee with a small benefit (that is, a benefit with a value not exceeding €250 (€100 up to 31st December 2004), PAYE and PRSI need not be applied to that benefit. This treatment does not apply to cash payments, which are taxable in full. No more than one such benefit given to an employee in a tax year will qualify for such treatment. Where a benefit exceeds €250 in value the full value of the benefit is to be subjected to PAYE and PRSI."

So on the face of it, it would appear to me that there's no problem with the directors being given vouchers, unless it's explicitly been communicated elsewhere...

Lynfo

Thanks for the replies.

I eventually got through to Revenue and they have confirmed that both directors and director's wives are eligible to receive tax free vouchers up to the value of €250.00 (per year).