Christmas Bonus

Irishdreamer

Hi,

Just wondering if anyone can help with a Christmas Bonus question.

I have looked up various websites about Christmas Bonuses and the small benefits reliefs. The information seems to vary.

My question is if someone gets a Christmas Bonus of €700 and gets this bonus as a gift card of €500 and the remaining €200 is added to their wages for a week, is only the €200 taxable?

Apologies if this seems like a stupid question.

Septic tank

Irishdreamer wrote: »

Hi,

Just wondering if anyone can help with a Christmas Bonus question.

I have looked up various websites about Christmas Bonuses and the small benefits reliefs. The information seems to vary.

My question is if someone gets a Christmas Bonus of €700 and gets this bonus as a gift card of €500 and the remaining €200 is added to their wages for a week, is only the €200 taxable?

Apologies if this seems like a stupid question.

Only the €200 will be taxed. Employers can gift one 4 all’s etc tax free up to a value of €500 in any one year.

qxtasybe1nwfh2

Irishdreamer wrote: »

Hi,

Just wondering if anyone can help with a Christmas Bonus question.

I have looked up various websites about Christmas Bonuses and the small benefits reliefs. The information seems to vary.

My question is if someone gets a Christmas Bonus of €700 and gets this bonus as a gift card of €500 and the remaining €200 is added to their wages for a week, is only the €200 taxable?

Apologies if this seems like a stupid question.

Yes this is correct. 500 euro voucher is the max you can get tax free.

Masala

Irishdreamer wrote: »

Hi,

Just wondering if anyone can help with a Christmas Bonus question.

I have looked up various websites about Christmas Bonuses and the small benefits reliefs. The information seems to vary.

My question is if someone gets a Christmas Bonus of €700 and gets this bonus as a gift card of €500 and the remaining €200 is added to their wages for a week, is only the €200 taxable?

Apologies if this seems like a stupid question.

... in my limited experience ... i would say your understanding is correct

retalivity

The small gifts benefit allows one tx-free amount up to €500 per year on a gift card. So it sounds like yes, only the 200 would be taxed, but i guess it would come down to how your employer has termed the bonus in your contract - can you take the 700 as cash and take the tax hit if you dont want a gift card?

Irishdreamer

retalivity wrote: »

The small gifts benefit allows one tx-free amount up to €500 per year on a gift card. So it sounds like yes, only the 200 would be taxed, but i guess it would come down to how your employer has termed the bonus in your contract - can you take the 700 as cash and take the tax hit if you dont want a gift card?

There is actually no mention of a bonus in the contracts. This is the first time the staff have been offered a bonus of either a gift card or cash (through payroll). The gift card is an excellent option so it was agreed with the staff to use this option. However one staff member is getting a higher bonus but still wanted the €500 gift card and it was our understanding that only the amount excess of the gift card, €200, would be taxable through the payroll system.

I read on a couple of websites that it works differently. For example one website stated "Where a bonus exceeds the €500 limit, the full value is subject to tax".

I'm just worried that we have done this incorrectly.

Masala

Irishdreamer wrote: »

There is actually no mention of a bonus in the contracts. This is the first time the staff have been offered a bonus of either a gift card or cash (through payroll). The gift card is an excellent option so it was agreed with the staff to use this option. However one staff member is getting a higher bonus but still wanted the €500 gift card and it was our understanding that only the amount excess of the gift card, €200, would be taxable through the payroll system.

I read on a couple of websites that it works differently. For example one website stated "Where a bonus exceeds the €500 limit, the full value is subject to tax".

I'm just worried that we have done this incorrectly.

Ya ... if you get a gift card for €700 - then the whole thing is taxable. but your question of getting 2 elements - one a gift card of €500 and then €200 into his wages is what we are addressing

cefh17

retalivity wrote: »

The small gifts benefit allows one tx-free amount up to €500 per year on a gift card. So it sounds like yes, only the 200 would be taxed, but i guess it would come down to how your employer has termed the bonus in your contract - can you take the 700 as cash and take the tax hit if you dont want a gift card?

Always take the oneforall, for a fee of €8 you can have the balance transferred in full to (I believe) a bank acc

Irishdreamer

Masala wrote: »

Ya ... if you get a gift card for €700 - then the whole thing is taxable. but your question of getting 2 elements - one a gift card of €500 and then €200 into his wages is what we are addressing

Thanks for the replies!

As you can tell I'm not familiar with this and apparently neither is the company I work for as this is the first year we are doing it.

Seeing various different information online is confusing.
For example another website said "If the €500 value is exceed in any year then the total benefit is liable for tax. There is no exemption for the first €500."
I could be wrong in my understanding of that piece though.

retalivity

cefh17 wrote: »

Always take the oneforall, for a fee of €8 you can have the balance transferred in full to (I believe) a bank acc

Super valu and tesco accept them, so can be used for groceries and every day living. Actually, i used my last one in a few pubs around dublin to buy a round of drinks, so no need really to transfer to a bank acc and get the cash!

Calahonda52

Was in Woodies earlier and they refused to accept it, told me that a wide number of retailers have installed new systems which wont accept them
I see this as blowback against the use of such cards

WacoKid

The gift card for €500 has to be in one go. You cannot give the small benefit relief in multiple gifts (i.e. €250 then €250). If you do then only the first gift is tax-free.

Wuff Wuff

cefh17 wrote: »

Always take the oneforall, for a fee of €8 you can have the balance transferred in full to (I believe) a bank acc

can have it transferred for free if you know do the paypal workaround