Expenses and benefits: social functions and parties Tax Tip
Posted on 18th November 2022
If you are an employer it’s great to have an annual event for your staff, whether it’s the Christmas party or the Summer BBQ, it helps to treat your employees every so often.
Is your event tax & NI exempt?
While these events do cost money, you can get around having to report these to HMRC or pay tax and national insurance on them. To make sure your annual get together is exempt it has to meet the following:
Cost £150 or less per head for the whole year (£150 is the cost per head for all events in the year and not just one of them)
The event must happen every year.
It must be open for all of your employees to come.
If not, then what?
If the event doesn’t meet the above then you’ll need to report the costs to HMRC by:
Reporting on each attending employees P11D form
Pay the Class 1A national insurance on the full cost of the event
The tax tip is provided for general guidance only; further advice should be sought, for specific issues.
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