Gift Cards - Integration and tracking

The gift card companies do not charge Thesaurus users for this integration. In addition, One4all offers payment by EFT to Thesaurus customers, a facility not available to regular customers. Me2You offers payment by EFT to all customers.

With the increase in the small benefit exemption to €500, more and more employers are using gift cards to show their appreciation to staff.

Revenue allow one small non-cash benefit per employee, per annum, up to the value of €500. (PAYE, PRSI or USC do not need to be applied to the benefit).

No more than one such benefit given to an employee in a tax year will qualify for such treatment. Where a benefit exceeds the specified amount of €500 the full value of the benefit is to be subjected to PAYE and PRSI. A small benefit that is treated as a distribution of a close company is not within the scope of this exemption.

Thesaurus Payroll Manager will track gift card purchases so that you are alerted if you attempt to purchase more than one gift card for an employee in any one tax year. Only gift cards purchased through our integration with the gift card companies will be tracked. In addition, you will be prevented from ordering a card in excess of the exemption limit, i.e. €500. This integration will allow you to easily order gift cards from either of the 2 major gift card companies, saving you considerable time on data input.

Thesaurus Payroll Manager can only handle gift card orders for those employees with PPS numbers but it should be noted that no PPS numbers, nor indeed any other personal information, are shared with the gift card companies. The only information transmitted is the information you see on the relevant Thesaurus screen. The last 3 characters of an employee's PPS number are used as a "works number" to distinguish between any of your employees who may share the same name.

In order to qualify for the small benefit exemption, it is important that gift cards are not given to employees as a salary sacrifice. A ‘salary sacrifice arrangement’ means any arrangement under which an employee forgoes the right to receive any part of his or her remuneration due under his or her terms or contract of employment and in return his or her employer agrees to provide him or her with a qualifying voucher. 

Gift cards can be used in many ways, including:

• A Gift at Christmas or at the Financial Year End
• To mark a Company Success - financial
• As an Incentive Reward
• As an Ad-hoc employee reward – this could be positive customer feedback, peer to peer recognition, a thank you for going above and beyond
• A Long Service Reward

To demonstrate how tax efficient the use of gift cards are, if a gift of €500 was to be paid to an employee in cash, through the payroll, the potential extra cost to the employer would be €653.65 calculated as follows:

 
Therefore, the use of gift cards in the above example results in overall tax savings of €653.65