Christmas parties - What can I claim?

Dec 16, 2011

Croombs Chartered Accountants in Hampshire

It’s the festive season and Accountants are often asked many questions about the office Christmas party and exactly what tax allowances are available.

The Revenue will allow an exemption for Companies from Tax, National Insurance and reporting the Christmas party (or your “Annual event” as they call it) to them if:

1. The event is an annual event such as the Christmas party or a Summer barbecue.

2. Is open for all your employees to attend

3. The event costs no more than £150 per head

If your event costs more than £150 per head you cannot claim a deduction up to £150 then pay tax on the difference.  It is an exemption not an allowance!

You can also only use this exemption once per year up to its maximum value.  If you already held a Summer Party which cost £100 per head and the Christmas Party will cost £90 per head you will not be able to waive any tax or NIC’s for your Christmas Party as the combined total is over the £150 exemption.

Conversely if you hold two parties costing £60 per head each you can claim the full amount as the total is below the £150 exemption.

An added bonus is that you can also claim a £150 exemption for any family members who attend your party, so if you are the only employee in the business you and your partner can go crazy and spend £300 tax free.

There’s a load more information on the Revenue website but if you want to discuss this exemption any further please give us a call.

Have a great Christmas Party!


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