
As a limited company owner, you can receive favourable tax treatment on your annual Christmas party. This means that the cost of the party can be recorded as a company expense, and as such, is excluded from your annual profit, which decreases the amount of corporation tax you will pay at the end of the tax year.
HMRC have a few rules that stipulate what a Christmas party can entail and how much is tax deductible. Providing you meet these, you?ll qualify for a rather jolly festive soiree, complete with a juicy tax exemption. The rules- The party has to be an annual event and not just a one-off shin-dig ? a regular Christmas party or Halloween spookfest, for example.
- You can, however, split the allowance into multiple events, so long as you don?t exceed the ?150 total limit. For example, you may wish to have an annual summer BBQ where you spend ?60 per head and a Christmas party where you spend ?80 per head.
- Must cost no more than ?150 per head – this includes all party-related things such as travel, food, drinks and venue.
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