Is a staff Christmas party a deductible expense?

Many employers like to organise a Christmas party for their staff in December. Some good news is that a Christmas party (including drinks) is a deductible expense. This is also the case for an online party.

The event needs to be inclusive so all employees can benefit, and the expenses involved need to be reasonable.

The same rules apply to any special occasion meals or other inclusive events, such as sports days for staff.

It is also worth noting that the cost of the party is not a taxable Benefit-in-Kind (BIK). 

You can also give a tax free voucher to your staff at Christmas through the Small Benefit Exemption Scheme.

 

Date published 1 Nov 2023

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.