In the spirit of seasonal cheer, we remind readers that HMRC has a festive loophole that means businesses pay no tax on corporate Christmas parties, providing that the cost “does not exceed £150 per head”. The exemption also applies to “similar annual functions” such as summer barbecues. The cost of the staff function can be treated as 'Staff Welfare', as if forms part of staff costs. If you are combining your function with customer entertainment then you will need to split
Any cost relating to entertaining of existing, potential customers and contacts is not treated as a cost for Corporation Tax purposes. It is still a valid business expense that will be shown in the company’s Profit and Loss Account within its annual Financial Statements. However, the company is not able to claim entertaining as a Corporation Tax deductible cost. Business entertainment is defined as any form of free or subsidised entertainment or hospitality to existing, pot
Well, this is not quite right … when it comes to staff parties and one off staff events, there is some room to manoeuvre to claim tax back. However, the rules are very strict.
To set out the facts, an annual employee event will be tax free and there is no need to enter them on a Form P11D. But only if the event meets the following three conditions:- the event is open to all of company employees, from the most senior to the most junior employees it’s an annual event, such as