Christmas Parties

Fortunately, there is a tax exemption in place for such events that means the fun and games won’t be marred by an unexpected tax bill. 

The cost of the Christmas party will be a deductible expense for the business and will not be a benefit in kind for employees if all the following criteria are met. 

The party is an annual event 

The party is open to all staff. 

Businesses with multiple offices can have separate parties at each office, but they must be open to all staff at those offices. 

The VAT-inclusive cost can be no more than £150 per person attending. This includes guests that employees bring along, such as their partners. If the cost exceeds this limit, then the whole cost becomes a benefit in kind, not just the additional cost. 

This exemption does not just apply to Christmas parties and a business can have other annual events throughout the year. However, should they do so they need to be aware the £150 applies to all events in a single tax year. 

We provide accounting and tax support to our clients all year round, not just at Christmas. If you want to make use of our services, please call us on 01892 807001.