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Business Services  |  Tax Savings
Me2You Gift Card

Tax Efficient

Save up to €1,980 per employee every year

Under the small benefit exemption scheme (BIK) employers can reward their staff with one-off, non-cash benefit per employee, per annum, up to the value of €1,500.  This does not apply to cash which is taxable in full.

Save up to €1,980 per employee

Benefit from the full range of savings under the governments’ small benefits exemption scheme when you gift an employee up to €1,500 per annum completely Tax Free!

A reward of €1,500 net paid through

Payroll

Me2You
Income Tax at 40% € 1252.61 –
USC at 8% + PRSI 4.1% € 378.91 –
Income Taxes paid by the employer € 1,631.52 –
Net Reward € 1,500.00 € 1,500.00
Employer PRSI at 11.15% € 349.16 –
Total Cost to Employer € 3,480.68 –
*Savings based on employer giving an employee €1,500 net on the higher tax bracket with the enhanced small benefit scheme as of Jan 1st 2025

Maximising the Small Benefit Exemption (SBE) with a Me2You gift card in 2025

Starting January 1, 2025, Ireland’s Small Benefit Exemption (SBE) rules will undergo significant enhancements, offering employers greater opportunities to reward their employees tax-free. These updates present an excellent chance for businesses to create impactful recognition and engagement programs.

Key Changes to the SBE in 2025

Increased Annual Limit:
– The total tax-free allowance rises from €1,000 to €1,500 per employee annually.
Flexible Distribution:
– Employers can issue up to five non-cash benefits per year (up from two), provided the total does not exceed the €1,500 limit.
Tax Advantages:
– Rewards under the exemption remain free from income tax, PRSI, and USC if they meet the non-cash requirement.

Creative Uses of the Updated SBE Rules

Employers can now design innovative reward strategies to strengthen employee engagement, retention, and morale:

Year-Round Recognition:
– Use the flexibility to spread rewards across key moments such as performance reviews, project completions, or special company milestones.
Engagement Through Structured Programs:
– Implement structured rewards programs like quarterly incentives to maintain consistent employee motivation throughout the year.
Seasonal and Festive Bonuses:
– Allocate part of the allowance for holiday rewards, reserving other portions for mid-year incentives or annual celebrations.
Retention and Loyalty Strategies:
– Tie non-cash benefits to work anniversaries, tenure milestones, or good attendance, helping foster a sense of loyalty and value.

Compliance and Best Practices

To maximise the benefits and stay compliant with Revenue guidelines:

Non-Cash Rewards:
– Ensure rewards are strictly non-cash and cannot be exchanged for cash.
Strategic Distribution:
– Leverage the increased flexibility of five rewards per year to align incentives with business objectives.
Accurate Record-Keeping:
– Maintain thorough records of all rewards to comply with Revenues, ERR (Enhanced Reporting
Requirements)
Partner with Experts:
– Collaborate with providers like Me2You gift card Recognition platforms to simplify administration and provide seamless reward options.

The 2025 enhancements to the SBE rules empower businesses to create more dynamic and tax-efficient employee reward systems. By leveraging these changes strategically, companies can strengthen their culture, retain talent, and foster a motivated workforce throughout the year.

 

Please get in touch with us today on 01 5542000 or email [email protected] to arrange an appointment so we can help your company maximise the new SBE rules.

2025 Advisory Update.

Small Benefit Exemption

A quick guide on how to get the most from the 2025 scheme enhancements and save up to €1,980 per employee every year

Under the small benefit exemption scheme (BIK) employers can reward their staff with a non-cash benefit per employee, per annum, up to the value of €1,500.  This does not apply to cash which is taxable in full. To help you get the most from this scheme we have put together a quick guide to the newly enhanced scheme.