Have a Happy and Tax Deductible Christmas For You and Your Staff This Year

2nd December 2013

... Comments

With Christmas just around the corner, its the time to be thinking of decorations, gifts for customers and treating employees to that all important Christmas night out but exactly how much should you spend and what can you claim back. We explain it all.

Christmas Decorations for your office is tax deductible (no huge santa's on the roof though folks - only in your office!)
Staff parties: you can spend up to £150 per employee on HMRC "qualifying" events. This includes summer and Christmas events, to qualify you have to invite all staff members and this can include family members that you employ. The £150 is an annual budget so you can spread it out over the year or spend it all at Christmas.
Christmas gifts: Strictly speaking, gifts for your clients or staff are not tax deductible, however, if you can demonstrate that the gift is a form of advertising and has a business function, you can spend up to £50 per person per year on gifts and treat the cost as a tax deductible business expense.
Christmas Bonus for staff This will count as ordinary earnings and be subject to PAYE and NI as if it were additional salary.

This means that your logo or a promotional message should appear on whatever you decide to give. Diaries, calendars, flash drives and other computer related items are all legitimate purchases. Suppliers of corporate gifts are always coming up with new products.

Word of Caution

Be careful not to overspend as once you exceed the threshold, no deduction whatsoever is allowable.

About the Author