Quick answer: Most UK employers spend £15–£40 per head on staff Christmas gifts. A gift costing £50 or less per employee (including VAT) is normally tax-free and NIC-free under HMRC's trivial benefits exemption, as long as it is not cash, not a cash voucher, not written into the contract and not a reward for performance. Go one penny over £50 and the whole value becomes taxable. The Christmas gifts for employees that get used are wearable or carried daily: fleeces, gilets, beanies, flasks. Order branded gifts in October or early November.
Staff Christmas gifts are one of the few pieces of spend where the rules, the budget and the choice of item are all tangled together. Get the item right and spend the wrong amount, and you have created a payroll problem. Get the tax right and pick a bad gift, and it goes in a drawer in January.
This guide covers all three: what UK employers actually spend, how the £50 rule works in practice, and which Christmas gifts for staff people genuinely keep, broken down by budget and by type of team.
What do I get my staff for Christmas?
Start with three questions, in this order:
- What is the budget per head including VAT? Keep it at £50 or under if you want it tax-free.
- Where do your people work? Outdoor and field teams value warmth; office teams value things they carry; remote staff need something that posts well.
- Would they have bought it themselves? If yes, it gets used. If it only exists because a logo needed somewhere to live, it does not.
For most UK businesses the answer lands on a quality wearable or a daily-carry item, branded small and tastefully. The sections below show what each budget buys.
What UK employers actually spend per head
There is no standard, but there are clear bands, and each one buys a different category of thing.
- Under £10 — accessories and desk items. Beanies, mugs, tote bags, a decent pen. Fine for large headcounts and seasonal or part-time staff.
- £10–£25 — the most common band for SMEs. Insulated bottles, flasks, embroidered caps, lighter garments. Boxing the item lifts the perceived value more than spending another fiver on the item itself.
- £25–£40 — where wearable gifts start to feel like real gifts. Embroidered fleeces, gilets, quarter-zips and heavyweight hoodies sit here.
- £40–£50 — softshells, waterproofs and two-piece boxed sets. Still inside the trivial benefits threshold if you are careful with VAT and packaging costs.
- Over £50 — fine, but understand that you have left the exemption behind. See below.
One practical note: the cost that matters for tax is what it costs you, including VAT, not the retail value. That works in your favour on trade-supplied branded goods, because a £30 trade-price fleece often has a retail feel well above £30.
The £50 rule: HMRC rules for gifts to employees
HMRC's trivial benefits exemption is the mechanism most UK employers use for Christmas gifts. Under GOV.UK's trivial benefits guidance, a benefit is exempt when all four of these are true.
- It costs £50 or less per employee, including VAT.
- It is not cash and not a cash voucher. A voucher that can be swapped back for cash is taxable however small. A non-cash retail gift card can qualify.
- It is not a contractual entitlement and not part of a salary sacrifice arrangement.
- It is not a reward for performance or for services the employee has provided. A Christmas gift to everyone is fine; a gift to your best salesperson for hitting target is pay.
For the full detail, including worked examples and how the average-cost rule works for group gifts, see our guide to trivial benefits explained.
The cliff edge is the bit people miss
The £50 is a threshold, not an allowance. Spend £55 and the taxable amount is £55, not the £5 above the line. This is the single most common and most expensive mistake in Christmas gifting, and it is entirely avoidable by pricing the gift including VAT and any branded packaging before you commit.
Directors of close companies have a cap
For ordinary employees there is no limit on how many trivial benefits you can give in a year, provided each one passes the four tests. Directors and office holders of close companies (broadly, companies run by five or fewer shareholders) are capped at £300 of trivial benefits per tax year, and that cap includes benefits given to members of their family or household.
The Christmas party is a separate exemption
Do not confuse the two. The annual functions exemption covers staff parties and events at up to £150 per head per tax year, where the event is annual and open to all employees (or all at a particular location). It has its own cliff edge: exceed £150 and the entire cost becomes a taxable benefit, not just the excess. Party and gift are separate exemptions and you can use both.
What about gifts to clients?
Different rules again. Business gifts to customers are normally disallowed for corporation tax, with an exception for items that carry a conspicuous advertisement for your business, cost £50 or less per recipient per year, and are not food, drink, tobacco or vouchers. That exception is exactly why a branded flask works better than a hamper when you are gifting clients. Our guide to corporate gift ideas for employees and clients goes into the choice in more detail.
A necessary caveat: we decorate clothing, we are not tax advisers. The rules above are the general position and they change. Run your specific plan past your accountant before you commit budget.
14 staff Christmas gifts that actually get used
The test we apply is simple: would the person have bought it themselves? If yes, it gets used.
Under £10 per head
- Embroidered beanie — cheap, worn constantly from November to March, and stitch on knitwear looks far better than print. See personalised beanie hats.
- Enamel camp mug — more durable and more liked than a standard ceramic mug.
- Branded tote or drawstring bag — high use, very low cost per impression.
- Embroidered patch set — niche, but memorable for creative and trade teams.
£10–£25 per head
- Insulated bottle or flask — the best value-for-money useful gift in this band, and it gets carried daily. See branded drinkware.
- Vacuum travel mug — the obvious pick for field-based and driving staff.
- Embroidered cap — works for outdoor teams; check your logo suits a small stitch area first. See embroidered caps.
- Beanie and bottle pairing, boxed — two cheap items presented well beat one mid-priced item presented badly.
- Custom Christmas jumper — doubles as kit for Christmas Jumper Day and gets you a usable team photo. See personalised Christmas jumpers.
£25–£40 per head
- Embroidered fleece or gilet — the most-worn gift we produce, full stop. Warm, neutral, and worn well outside work. See embroidered fleeces and branded gilets.
- Quarter-zip sweatshirt — smarter than a hoodie, so it suits office and client-facing teams.
- Heavyweight embroidered hoodie — pick a premium weight; a thin hoodie reads as a freebie immediately. See embroidered hoodies.
£40–£50 per head
- Softshell or waterproof jacket — genuinely useful for anyone working outdoors in a British December.
- Boxed garment-plus-flask set — the strongest presentation available inside the £50 threshold.
Christmas gifts for employees, by type of team
The same budget buys a different best gift depending on how your people work.
- Office and client-facing teams: quarter-zips, premium hoodies with a small left-chest logo, insulated bottles. Smart enough to wear to meetings, comfortable enough to wear at weekends.
- Trades, field and warehouse teams: fleeces, gilets, beanies and flasks. Practical warmth wins every time in December, and these items get worn on site, which keeps your brand visible.
- Remote and hybrid staff: pick items that post flat and survive transit, such as a beanie, a folded fleece or a boxed bottle. Collect home addresses early and allow for courier time on top of production.
- Mixed or seasonal workforces: a two-tier approach works well, with a core gift for everyone and the same item in a better presentation for long-serving staff. Keep every version under £50 including VAT, or treat the higher tier separately.
- Nurseries, schools and care settings: soft, washable layers and accessories over desk gifts, as most of the working day is spent away from a desk.
What to avoid
- Branding it too loudly. A small left-chest logo reads as quality. A full back print reads as advertising, and advertising is not a gift.
- Cash or cash vouchers. Taxable regardless of amount, and administratively annoying.
- One size for everyone. Collect sizes properly or you will hand out garments nobody can wear. A quick anonymous size form beats guessing.
- Performance-linked gifts. The moment it is a reward, it is pay.
- Leaving it to December. See below.
When to order
Branded gifts are not stock items. They are decorated to order, and that takes time on top of the delivery. For 2026 the realistic windows are:
- October — full colour and size availability, no rush. Order here if you can.
- Early November — the last comfortable window for embroidery on larger runs.
- Late November — possible, but popular colours start selling out.
- December — restricted choice, and some items simply will not be achievable in time.
Our full branded Christmas merchandise calendar sets out the month-by-month timeline, including artwork deadlines.
FAQs
What is a nice gift for staff?
Something useful that they would have chosen themselves: a quality fleece, gilet or hoodie, an insulated bottle, or a warm beanie. Keep the branding small and the quality high. A well-made item with a discreet logo is worn for years; a cheap item with a big logo is not worn at all.
What are the HMRC rules for gifts to employees?
Most staff Christmas gifts rely on the trivial benefits exemption: £50 or less per person including VAT, not cash or a cash voucher, not contractual, and not a reward for work. If a gift fails any of these, it is a taxable benefit and needs reporting. Self-employed people giving personal gifts to their employees have no reporting obligation, according to GOV.UK.
What is the 7-gift rule?
It is an informal gift-giving framework for families, limiting presents to a few categories such as something they want, something they need, something to wear and something to read. It is not a workplace or tax rule. For staff gifts, the only rule that matters is HMRC's £50 trivial benefits test, though "something to wear" is, in our experience, the category that gets used most.
Do staff Christmas gifts need to be reported to HMRC?
If the gift qualifies as a trivial benefit, it does not need to go on a P11D or through a PAYE Settlement Agreement. If it fails any of the four conditions, it becomes a reportable benefit. Keep a simple record of what you gave, to whom, and what it cost you including VAT.
Can we give everyone the same gift?
Yes, and it is usually the cleanest approach. The exemption is applied per employee, so an identical £35 fleece for all 40 staff is 40 separate trivial benefits, not a single £1,400 benefit.
Does branded packaging count towards the £50?
The cost of providing the benefit is what counts, so budget for the box, the card and the decoration alongside the item rather than treating them as extras. If you are close to the line, this is where people accidentally cross it.
Is there a minimum order for branded Christmas gifts?
There is no minimum order at CentralCustom, so a gift for a team of six is as welcome as one for 600. Per-unit cost does fall as quantities rise, because setup is a one-off cost spread across the order, and your logo setup is kept on file for reorders.
How long does branded Christmas gifting take end to end?
Quotes come back within one working day, then you approve a free digital proof. Orders are typically dispatched 7 to 14 working days after proof approval, with delivery on top. Working backwards from a mid-December handover, an October start is comfortable and a late-November start is not.
Getting a quote
Tell us your headcount, your budget per head and your handover date, and we will come back with options at two or three price points with a per-unit cost, and say so honestly if your deadline is not realistic. Browse corporate Christmas gifts, our year-round corporate gifts range, or request a quote.
