At this time of year many companies will often (prior to the recession at least) hand out gifts to people they do business with, possibly as a thank you or mark of appreciation. In this instance then, subject to certain conditions being met, there are no taxation implications.
However, it is a little known fact that as a general rule you should produce a P11D for any benefits you as an employer provide to non-employees, or employees of other companies. There is a relief though that avoids this need. The relief is subject to a maximum limit of £250 per tax year and as long as it isn't
- Cash, shares or services
- Not in recognition of specific performance
In all other instances you should as complete a form P11D for the value of the gift or let the recipient know the value so that they can report directly under their own self assessment.
We always find that this is a strange rule, you can actually provide gifts to non-employees up to £250 and only entertain your own staff to the value of £150 per tax year!