Tax Free Voucher for Employees

December 20, 2017 Tax Advice 0 Comment

Tax Free Voucher for Employees

Under Revenue’s Small Benefits Exemption Scheme you can give employees a small benefit of up to €500 in value, tax-free, each year. This benefit must not be in cash.

If more than one benefit is given in a year, only the first one qualifies for tax-free status. Unused allowance amounts cannot be carried over.

Please note tax-free vouchers or benefits can be used only to purchase goods or services. They cannot be redeemed for cash.


  • The gift voucher must be purchased by the employer.  An employee cannot purchase a voucher themselves and seek reimbursement from their employer.
  • A voucher can be purchased for each individual only once per year. If an employee is given a voucher of €250 and a further voucher of €250 at a later point in the year only the first €250 will be deemed tax free

Possible tax Savings

A higher rate taxpayer will save up to €520 in tax by availing of this scheme.

Net Salary equivalent €500

To pay this you need a Gross salary €1,042

A difference of €542 relates to PAYE, USC and PRSI.

There is also a further possible saving of 10.75% Employers PRSI for those employees on the A class rate.

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Joe Cunnane Practice Owner TRA Professional Services       Qualifications:  FCA Chartered Accountant & AITI Chartered Tax Advisor Joe has over 20 years experience working in both private practice and industry ... Read More »