As a limited-company director you can take several things from your company completely tax-free: small gifts of up to £300 a year, an annual event of up to £150 a head, work equipment, a company mobile, pension contributions, and a home-office allowance. Used properly, these are a legitimate way to get more value out of your company without paying extra tax on it.
Here is what each one covers, and the rules that keep them tax-free.
Trivial benefits: up to £50 a gift, £300 a year
Your company can give you small gifts — a meal out, a bottle of something, a store voucher — of up to £50 each, tax-free. As a director, you can receive up to £300 of these across the year.
Three conditions keep them "trivial": the gift can't be cash or a cash voucher, it can't be a reward for work you've done, and it can't be something you're contractually entitled to. Stay inside those and there's no tax and no reporting.
The annual staff party: up to £150 a head
Your company can spend up to £150 a head on an annual event — a summer party, a Christmas do — and it's tax-free for those attending. The figure is per head, so it covers you (and a partner, if they come).
The catch worth knowing: £150 is a cliff edge, not an allowance. Spend £150 a head and you're fine. Spend £150 and one penny, and the whole cost becomes a taxable benefit — not just the part over the line.
Work equipment
Equipment your company buys and owns for you to work with — a laptop, a monitor, a desk, a chair — is tax-free, as long as any private use isn't significant, and the cost helps reduce the company's taxable profit.
From 6 April 2026 this also covers reimbursement. If you buy qualifying work equipment yourself and the company pays you back, that's now tax-free too, under a new relief (s.316ZA) that brings the reimbursed route into line with the company buying the kit directly. Before 2026/27 that reimbursement would have been taxable, so it's a genuine improvement this year. Private use still needs to be insignificant.
A company mobile
Your company can provide one mobile phone on a company contract — the handset, the service plan, and all private calls included — with no tax charge. The contract needs to be in the company's name, not yours.
Pension contributions
Contributions your company pays directly into your pension are one of the most efficient ways to take money out. They're a deductible cost for the company, and you can usually pay in up to £60,000 a year (plus carry-forward of unused allowance from earlier years). For profit you don't need to draw now, this often beats taking it as a dividend.
Working from home
If you run your company from home, it can reimburse you £6 a week tax-free towards the cost, with no receipts needed. It's a small amount, but it's simple and it adds up over the year. (There's a larger home-office lever — renting a room to your company — that's worth its own conversation.)
A few more worth knowing
Eye tests for screen work are exempt. So are relevant professional subscriptions and training that maintains the skills you already use in the business. And the mileage rate for using your own car rose in 2026 — we've covered that change separately.
Frequently asked questions
What perks can a director take tax-free? Trivial benefits (up to £50 a gift, £300 a year), an annual event up to £150 a head, work equipment the company owns, one company-contract mobile, employer pension contributions (up to £60,000 a year), and a £6-a-week home-working reimbursement.
How much is the tax-free staff party allowance? Up to £150 a head for an annual function. It's a cliff edge — go a penny over and the whole cost becomes taxable, not just the excess.
Can my company pay into my pension? Yes. Employer pension contributions are a deductible cost for the company, up to £60,000 a year including carry-forward — often the most tax-efficient way to take profit you don't need now.
Work with us
Making the most of these without tripping a rule is exactly what we help founders with. Book a call with Carr Accounting Studio and we'll go through which of these apply to you.
Not sure where you stand? The free FounderTax check flags what's worth a closer look in about two minutes.
General information, not advice. UK figures 2026/27 — they change, and your situation may differ. Written by David Carr, chartered accountant and founder of Carr Accounting Studio.