HMRC does allow limited companies some scope to spread a little festive cheer to directors, staff and business associates. It is not often that there is generosity from HMRC so make the most of it!
The following things can be put through on your company.
- Gifts can be given to clients up to a value of £50 per person. If it is food or alcohol then the gift is not tax deductible but is still classed as a business expense so you can claim for it.
- Gifts to staff up to £50 per gift are tax deductible. So you could give a bottle of champagne for £40 and a £50 turkey and both would be allowable.
- Christmas party up to a value of £150 per person attending. That means that a sole director could invite their spouse/partner and two children and spend up to £600. Be careful to include all associated costs such as travel, meals, tickets and do not exceed the £150 per person otherwise the whole allowance is removed. The party allowance can actually be claimed at any time of year as long as the £150 is not exceeded.
For the above expenses, make sure you get receipts and note on the receipt who the gift was for and who attended the party.
If you have any further queries or would like to receive a free copy of the report, please get in touch with myself via firstname.lastname@example.org or my colleague John Mumford via email@example.com.