Staff Christmas Party

The exciting bit:
It will soon be Christmas and that could mean a party!

Now for the boring bit:
A staff party or an annual function qualifies as a tax-free benefit for your employees providing that you meet the following conditions:
·        The total cost must not exceed £150 per head, per year.
·        £150 includes VAT together with any extra costs such as transport and accommodation.
·        The £150 is a limit and not an allowance: if the cost is £151, the whole benefit is taxable.
·        The event must be primarily for entertaining staff.
·        The event must be open to all staff.
·        The cost of the whole event is an allowable expense for your business.
·        You can claim back input VAT but this may be restricted where you are also entertaining customers.

The even more boring bit:
Get an invoice or receipt for your records.

Shaw Austin are a firm of Chartered Accountants based in Chester. We support independent business throughout the UK. We take the headache out of business accounting and taxation by providing our clients with a personal service.

Published November 2022