Christmas is almost here, and a little extra kindness can go a long way during the festive season. If you’re considering giving your household staff a Christmas bonus this year, here’s a short guide on what you need to know…
Is a Christmas Bonus Necessary for Household Staff?
Many domestic employers choose to give their employees a bonus at Christmas to spread some holiday cheer, however you are not required to give your employees a bonus, unless specified in their employment contract.
Determining the Right Amount for a Christmas Bonus
Deciding how much to give your employee(s) for their Christmas bonus is at your own discretion. Christmas bonuses are usually calculated as a percentage of your employee(s)’s annual salary and typically range from half a week’s pay to a full month.
Am I required to pay tax on the Christmas Bonuses for my Household Staff?
Yes, you will need to pay tax on your employee(s) Christmas bonus. If you are a Stafftax client, we will display the Christmas bonus, and subsequent tax due, on your employee(s)’ payslip.
Can I Give the Christmas Bonus in Cash?
Yes, you can pay your employee(s) their Christmas bonus in tax if you desire. However, please note that any cash bonuses will still need to be reflected on your employee(s)’ payslip.
Do Christmas Gifts for Household Staff Need to be Reported to HMRC?
If you prefer to give your employee(s) a gift at Christmas, it’s good to know what does and does not need to be reported to HMRC. Gifts which are under £50 are classed as a ‘Trivial Benefit’ and do not need to be reported.
The following is what is considered a ‘Trivial Benefit’:
- Gifts which cost £50 or less to provide
- Are not cash or a voucher
- Are not a reward for work or performance
- Are not in the terms of your nanny’s contract
I’m a Stafftax Customer, how should I pay my Household Staff their Christmas Bonus?
If you’d like to give your household staff a Christmas bonus this year, you can easily do so through your Members Area. Simply go to the Manage Employees tab, select Bonus, and specify whether it’s a cash bonus along with the amount. Our payroll team will then make sure the bonus and any required tax adjustments for HMRC are reflected on your employee’s next payslip.
Please note, for your employee’s Christmas bonus to be reflected in their December payslip, you must let us know by the Payroll Cut-off Dates:
- For Stafftax Plus customers, this is the 6th December 2024
- For Monthly Stafftax customers (monthly payslips), this is the 12th December 2024
- For Weekly Stafftax Customers (weekly payslips), you will need to let us know of any changes by the Wednesday the week before the payslip is due.
- For Variable Stafftax Customers, this is the 25th December 2024
If you let us know about your employee’s Christmas Bonus after the cut-off dates, the bonus will be reflected in your employee’s January payslip.
