Yes, it’s real! And each year, you can claim a non‑cash bonus of up to €1,000 tax‑free through your company. It’s called the Small Benefits Exemption Scheme.
How it works
· The bonus must be given as a non‑cash item, usually a gift voucher purchased by your company, either from the employer company bank account or company credit card – not by you.
· The director or employee cannot purchase a voucher themselves and seek reimbursement from their employer company. This is especially important for Personal Service Company contractors to be aware of.
· You can receive up to five vouchers per tax year from 2025 (totalling a maximum value of €1,500).
· Don’t forget: This is an annual benefit, so put a reminder in your calendar!
What it means for you
· Your company treats the voucher as a tax‑deductible business expense.
· Meanwhile, you save more than you’d expect. Higher‑rate taxpayers can save over €1,000 in tax by taking the voucher through the company instead of buying it personally.
HOW MUCH TAX WILL I SAVE?
A higher rate taxpayer, will save up to €1,083 in tax by availing of this scheme.
| Gross salary | €3,138 |
| PAYE at 40% | €1,255 |
| PRSI at 4% | €132 |
| USC at 8% | €251 |
| Net payment | €1,500 |
| Total tax saved = | €1,683 |
If you are a standard rate taxpayer (i.e. the 20% tax band), your tax savings will be less.
The gift voucher is also a fully deductible business expense for your company.
Reporting Benefit to Revenue
With effect from 1 January 2024 under the Enhanced Reporting Requirement (ERR) rules the small benefit exemption needs to be reported to Revenue prior to the benefit being given to the employee or the director. This is a mandatory step for all employers. Failure to report this information correctly and on time can result in penalties.
Want help getting this bonus?
Let Fenero take care of it. We’ll arrange your tax‑free vouchers. No hassle, no fuss. Just let us know, and we’ll sort it out for you.
For support with any of the above, please contact us at hello@fenero.ie or 01-6877400.
