Download 2025 Tax-Free Gifting Guide
Download our 2025 Tax-Free Benefits FAQ to learn all about the Small Benefit Exemption scheme and how all businesses in Ireland can save up to €2,007 per employee per year when gifting their employees with CleverCards.
Calculate your tax-savings with CleverCards
| Through Payroll | Through | |
|---|---|---|
| Total payment to employees | €31,249.95 | €15,000.00 |
| PAYE at 40% | €12,499.98 | €0.00 |
| USC at 8% | €2,500.00 | €0.00 |
| PRSI at 4.35% | €1,359.37 | €0.00 |
| Net Reward per employee | €1,500.00 | €1,500.00 |
| Employer PRSI at 11.4% | €3,562.49 | €0.00 |
| Total cost to employer | €34,812.44 | €15,000.00 Tax Savings: €19,812.44 |
Total cost via:
Payroll:
€34,812.44
:
€15,000.00
Tax Savings with CleverCards: €19,812.44
See breakdown
- Total payment to employees:
- €31,249.95
- PAYE at 40%:
- €12,499.98
- USC at 8%:
- €2,500.00
- PRSI at 4.35%:
- €1,359.37
- Net Reward per employee:
- €1,500.00
- Employer PRSI at 11.4%:
- €3,562.49
- Total cost to employer:
- €34,812.44
*Please note that the tax-free benefit values mentioned here are as per the Small Benefit Exemption in Ireland for 2025. Tax regulations and exemption thresholds may vary from one country to another. We recommend consulting with a local tax advisor or relevant tax authority to understand the specific rules and benefits applicable to your country.
Tax-Free Gifting For Employees In Ireland
Employers in Ireland can gift each employee a tax-free benefit of up to €1,500 per year via the Small Benefit Exemption Scheme. SBE is a scheme, with rules set by Revenue, that allows businesses to gift employees without incurring any tax complications, provided the benefit is non-cash in nature. This essentially means that employees can be rewarded without incurring any PAYE, PRSI or USC charges
How Can Employers Give Tax-Free Gifts To Employees?
To give employees tax-free gifts under the Small Benefit Exemption Scheme, employers must follow certain rules stated by Revenue. These include:
- The benefit cannot be given in cash or converted into cash, either in whole or in part
- Employers may provide up to five small non-cash benefits annually, but the combined value of these benefits must not exceed €1,500 per employee. If more than five benefits are provided, only the first five benefits will be tax-free.
- The gift must not form part of a salary sacrifice agreement. This means an employee cannot agree to forgo a part of their salary in exchange for a tax-free benefit.
Best Tax-Free Gift For Employees In Ireland
Employers can choose from multiple non-cash gifts, such as gift cards, vouchers, or tangible items like watches, hampers, and jewellery. One gift that stands out in terms of cost and flexibility is a digital Mastercard gift card. These are cards that are pre-loaded with funds and are powered by the Mastercard network, which means they can be used all over the world
CleverCards offers prepaid employee benefit cards that are Mastercard-powered. These cards can be sent over to employees in bulk instantly via email. Employers can easily load the card, upload employee details and send employees their gift cards. Employees can then add CleverCards to their Google Pay or Apple Pay and use them to pay over 50 million merchants worldwide.
When Can Businesses Gift Employees Tax-Free?
One of the best parts of the Small Benefit Exemption Scheme is its flexibility. Businesses can choose to reward employees on multiple occasions as long as they stay within the annual tax-free limit. Here are some occasions where tax-free gifts in Ireland can be used:
- Christmas or year-end is a popular time to appreciate employees
- Work Anniversaries are great for celebrating employee loyalty and long-term commitment
- Performance Milestones are exceptional opportunities to recognise employees
- Onboarding gifts are a great way to help new hires feel comfortable
Hear it from our customers first
"Our team has been thrilled with CleverCards. Unlike other gift cards, they can use their CleverCard anywhere by adding it to their phone wallet, whether it's Apple Pay or Google Pay. This flexibility has really boosted morale and created a great buzz in our workplace."
Danica Murphy
Director of Prism Leadership & Change Consulting Ltd., Prism LCC
"CleverCards is the best way to incentivise and reward our employees. With our previous supplier, it was very time-consuming to order and distribute physical gift cards. With CleverCards we can distribute the cards instantly to all of our employees via email and they are delighted that they can use them anywhere. Best of all, the gifts are tax-free."
Alan Henley
Managing Director, Granite
"CleverCards streamlined our employee gifting at Republic of Work a making it an easy and smooth experience. We were able to deliver the cards instantly to all our employees via email, so there was no need for manual distribution. Besides, embracing digital cards also aligns with our commitment to sustainability by reducing plastic usage."
Frank Brennan
CEO, Republic of Work
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Frequently Asked Questions (FAQ)
A tax-free employee benefits card is a prepaid card like the one offered by CleverCards. These cards are pre-funded by employers and sent to employees. As per the Small Benefit Exemption Scheme, employers can load up to €1,500 annually as a non-cash benefit, completely tax-free.
Yes, the Small Benefit Exemption Scheme allows employers to give employees and directors non-cash gifts like gift cards or vouchers worth up to €1,500 without paying any tax on them. To qualify, the gift must be non-cash in nature. If cash is offered as a gift, it is considered income, and taxes like PAYE, PRSI, or USC Charges are levied on it.
Using CleverCards is simple. Employees receive their individual digital cards over email. The card can then be activated with one click and added to Google Pay or Apple Pay. Since the card is prepaid and Mastercard-powered, employees do not need to spend out of pocket, and it can be spent at over 50 million merchants worldwide, both online and in-store.
No, gift cards are tax-free in Ireland up to €1,500 per employee per year, provided they meet the requirements under the Small Benefit Exemption Scheme. If the value exceeds €1,500, then the entire amount becomes taxable.
Employers can gift employees up to €1,500 per employee, per year, tax-free through the Small Benefit Exemption Scheme as long as the gift is a non-cash benefit, such as a gift card, vouchers, or physical gifts.
In Ireland, gifts are generally taxed under Capital Acquisitions Tax (CAT). However, for employees, there is an exemption under the Small Benefit Exemption Scheme, which allows employers to give non-cash benefits such as gift cards worth up to €1,500 per year completely tax-free. If the value of the benefit goes above €1,500, the full amount becomes taxable through PAYE, PRSI, and USC.
In Ireland, non-cash benefits such as gift cards, gift vouchers, and tangible gifts like jewellery, watches, bags, t-shirts, etc, are exempt from tax up to a specified limit. However, if cash is offered as a gift or any gift that can be exchanged for cash, then it is not exempt.
If the value of the gift card or voucher given to an employee exceeds €1,500 in a year, the entire amount (not just the excess) becomes taxable. The gift will then be treated as a benefit-in-kind and subject to PAYE, PRSI, and USC.
Employees can receive up to five tax-free benefits per year, provided the combined total value does not exceed €1,500. If the combined amount is above the limit, the full value becomes taxable.