Christmas bonus - hospitality industry - yay or nay?

[larrylamb11]

I've recently taken on a senior role in a charity whose retained staff are essentially engaged in hospitality - kitchen staff, grounds staff, cleaning staff etc. what I would designate as 'domestic staff'. The vast majority of the staff work properly hard.
In line with what I believe would be customary for domestic staff, I am suggesting they should be given a 'Christmas bonus' as a thank you for the work they've done through the year and as a sign of our appreciation for their efforts - I am suggesting £100 per person for everyone (hardly generous, but not insulting). They have received bonuses in the past.

The charity directors are positioning not to award any bonuses or gifts.

Am I off the mark here? Are Christmas bonuses a thing of the past?

[soad]

Usually get a bottle of cheap wine and a box of chocolates?

[SydneyBridge]

I worked for a small company that gave nice food/drink hampers to all staff

[Simpo Two]

larrylamb11 said:

The charity directors are positioning not to award any bonuses or gifts.

One could say that is not very... charitable...

But perhaps their view is that the money in the coffers has been donated by people to be spent on a specific purpose, not staff bonuses.

[Sy1441]

Non-exec of a charity here. Having been drafted on to the board to bring operational and HR experience my advice is pretty much always "Forget it's a charity and pretend it's a business" then the decisions are generally made because the outcomes are positive for the business. In my retail and hospitality businesses everyone will get a gift, will either be vouchers or a gift bag of things we've picked out worth.

[Mick Dastardly]

We have 23 staff and on Tuesday this week we nipped to the bank and drew out £4600, stuck 200 quid in a load of Christmas cards and went round and gave it to our (mostly) excellent employees.

Started doing it in 2020 after Covid hit and they really stepped up to support the businesses, and we’ve carried it on ever since. They truly are all very appreciative, me and the missus get a warm glow inside and so it’s a win win for all concerned.

[Countdown]

Mick Dastardly said:

We have 23 staff and on Tuesday this week we nipped to the bank and drew out £4600, stuck 200 quid in a load of Christmas cards and went round and gave it to our (mostly) excellent employees.

Started doing it in 2020 after Covid hit and they really stepped up to support the businesses, and we’ve carried it on ever since. They truly are all very appreciative, me and the missus get a warm glow inside and so it’s a win win for all concerned.

At the risk of sounding like the Xmas Grinch how do you account for the tax/NI on that?

[trickywoo]

Countdown said:

At the risk of sounding like the Xmas Grinch how do you account for the tax/NI on that?

I was thinking the same.

If it was me I’d stick to £150 (inc vat) each and give a hamper or similar. It then falls into the ‘annual party’ expense category and is reclaimable and has no NI, P11 etc. implications.

[Mick Dastardly]

Countdown said:

At the risk of sounding like the Xmas Grinch how do you account for the tax/NI on that?

We take the money out as taxable income, and then it’s entirely up to us if we want to give it away to our employees.

[Countdown]

Mick Dastardly said:

Countdown said:

At the risk of sounding like the Xmas Grinch how do you account for the tax/NI on that?

We take the money out as taxable income, and then it’s entirely up to us if we want to give it away to our employees.

You'll have paid income tax on that (and probably at a higher level than your Employees) You may also have had to pay Corporation tax on that, so it's probably cheaper just to pay them via payroll.

Or do what Tricky suggested and give them a hamper.

[Giantt]

Simpo Two said:

larrylamb11 said:

The charity directors are positioning not to award any bonuses or gifts.

One could say that is not very... charitable...

But perhaps their view is that the money in the coffers has been donated by people to be spent on a specific purpose, not staff bonuses.

People need to look at CEO and senior staff salaries and perks then

[Giantt]

Mick Dastardly said:

We have 23 staff and on Tuesday this week we nipped to the bank and drew out £4600, stuck 200 quid in a load of Christmas cards and went round and gave it to our (mostly) excellent employees.

Started doing it in 2020 after Covid hit and they really stepped up to support the businesses, and we’ve carried it on ever since. They truly are all very appreciative, me and the missus get a warm glow inside and so it’s a win win for all concerned.

Despite what others say,I'd commend you on this,just hope Mutley got his share

[MustangGT]

Mick Dastardly said:

Countdown said:

At the risk of sounding like the Xmas Grinch how do you account for the tax/NI on that?

We take the money out as taxable income, and then it’s entirely up to us if we want to give it away to our employees.

Not so, any emoluments of that size paid to employees as cash or cash equivalents are treated as taxable income for the individual.

[trickywoo]

MustangGT said:

Mick Dastardly said:

Countdown said:

At the risk of sounding like the Xmas Grinch how do you account for the tax/NI on that?

We take the money out as taxable income, and then it’s entirely up to us if we want to give it away to our employees.

Not so, any emoluments of that size paid to employees as cash or cash equivalents are treated as taxable income for the individual.

I'm not getting into a pile on over what is obviously a thoughtful thing for an employer to do but HMRC won't look at £4k+ as incidental and the cash gift should really be on the payslip and subject to the relevant PAYE and NI. I'm quite surprised your accountant hasn't said anything if you've done this before.

[Greenmantle]

MustangGT said:

Mick Dastardly said:

Countdown said:

At the risk of sounding like the Xmas Grinch how do you account for the tax/NI on that?

We take the money out as taxable income, and then it’s entirely up to us if we want to give it away to our employees.

Not so, any emoluments of that size paid to employees as cash or cash equivalents are treated as taxable income for the individual.

I'll just leave this here

https://www.youtube.com/watch?v=ldwwOD5IY98

Compared to the above non payment of income tax on £200 is negligible!

[ChocolateFrog]

Giantt said:

Simpo Two said:

larrylamb11 said:

The charity directors are positioning not to award any bonuses or gifts.

One could say that is not very... charitable...

But perhaps their view is that the money in the coffers has been donated by people to be spent on a specific purpose, not staff bonuses.

People need to look at CEO and senior staff salaries and perks then

No it's the cleaners on minimum wage that are taking money out of the coffers.

[Countdown]

MustangGT said:

Mick Dastardly said:

Countdown said:

At the risk of sounding like the Xmas Grinch how do you account for the tax/NI on that?

We take the money out as taxable income, and then it’s entirely up to us if we want to give it away to our employees.

Not so, any emoluments of that size paid to employees as cash or cash equivalents are treated as taxable income for the individual.

Given that the payment is made out of taxed income then Mick is probably fine. If Mick had been paying out of company finds rather than personal funds it would be a different kettle of fish.

[blueg33]

Trustee of one Charity and Director of another

The one I am Trustee of does not do a Christmas bonus but does have an annual bonus.

The one I am a director off doesn't have a christmas bonus but contributes £20 per head to a christmas event"

[cts1975]

I give my employees £100 each at Christmas. It's £100 well spent
Some of them have come from large national companies that never paid Christmas bonuses so really appreciate the bonus.

[Gary29]

Is this just the hospitality industry we're talking about? Or are Xmas bonuses becoming a thing of the past?

We're lucky that we get quite a generous bonus based on our annual profits. I thought this was a fairly common deal?