Christmas Gifts – Tax deductible?

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Christmas Gifts – Tax deductible?

A quick reminder of the Christmas gifts which are tax free to give to your staff and customers this year.

Employees : Trivial Benefits

Did you know that a business can reward its employees with a meal out, bottle of wine or an Amazon voucher without paying any tax?

Thanks to a new HMRC rule, employees pay no tax on ‘trivial benefits’ and the business can claim full tax relief.   If an expense meets the criteria you don’t need to declare it on an employee’s P11d, which means they don’t pay any extra tax and national insurance.

The criteria which must be met are:

  1. The cost must be no more than £50.
  2. The benefit must not be a reward for services or in any way contractual.
  3. The benefit must not be cash or a cash-voucher (exchangeable for cash).

Use this new rule to your advantage to maximise your Christmas gift to your staff.

Here at Stubbs Parkin we took advantage of the new rules and gifted our valued team with a £50 gift voucher in time for the Black Friday sales.  They even came with a free Christmas gift box!

Don’t forget, you can also pay for:

Staff Christmas Party

You can entertain your staff at the annual staff party and claim full tax relief on the cost provided it does not exceed £150 per head, per year.  This amount includes any VAT paid but you can also reclaim this.  The event must also be open to all staff and if you do entertain customers you may have to restrict your claim.

Gifts to customers

Gifts which advertise your business and are not food, drink or tobacco are allowable.   So calendars, diaries, stationery etc are all acceptable as customer/client gifts.

Christmas Fun!

Finally if you are in any need of inspiration for your Christmas Event, we would highly recommend trying something a bit different to give everyone a great experience.  Our favourites from the past few years have included dinner parties with dodgems, trying our hand at roulette at the casino and Breakout escape rooms.  This years line-up of fun includes Ghetto Golf, Mowgli for some Indian street food and Roxy Ballroom for some beer pong and table tennis!

2016 Christmas Fun at Breakout




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