MAXIMISE YOUR TAX EXEMPTIONS FOR CHRISTMAS PARTIES

With the festive season now here, Branagans Accountancy Services are reminding businesses to review their tax exemptions for Christmas parties. Proper planning can help your company save money while celebrating the festive season with your team.

The £150 per employee exemption is available to businesses hosting annual events, including Christmas parties and summer barbecues. To qualify, the event must meet three key criteria:

• It must be open to all employees
• It must be an annual event
• The cost must not exceed £150 per person, including VAT

These rules apply equally to in-person and virtual celebrations.

Plan Ahead to Avoid Unexpected Costs

Donna Branagan, Director at Branagans Accountancy Services, comments:
“Christmas parties are a wonderful opportunity to bring teams together, but it’s important to ensure your plans align with the available tax exemptions. Properly managing the allocation can help businesses avoid unexpected costs or reporting obligations.

Businesses can host multiple parties across various locations, provided every employee has the chance to attend one. Additionally, companies can hold more than one annual event, as long as the combined cost does not exceed £150 per employee.

However, if your event does not qualify for the exemption, or if you have already used your £150 per employee allowance earlier in the year, you may need to report the cost on your employees’ P11D forms and pay National Insurance Contributions (NICs) accordingly.”

Let Branagans Help You Celebrate

Branagans Accountancy Services is here to support your business in navigating these rules and making the most of your festive celebrations. For more information, contact Branagans on 01709 327 215 or email [email protected]