Christmas party? | do it virtually and get the tax back!
This year has been (erm, let’s say) testing to say the least, and you might think it more important than ever to say thank you to your staff.
However, given lockdown restrictions you’re not going to be having the annual xmas party at the local bar or restaurant.
HMRC has just updated its guidance, confirming that the cost of a ‘virtual’ party is an allowable expense for your salon.
“A company holds one annual function in a tax year and does so virtually using IT. All employees are invited and each is provided with a hamper consisting of some food and drink to be enjoyed by the attendees during the party. The total cost per head is £100 which is within the £150 exemption and so the exemption applies.”
In other words, spend up to £100 on each of your employees on something they can enjoy while attending a Zoom meeting. Say some words of thanks, then let them get on with it, and get the tax back!
Not just for xmas
And the rules mean that you don’t have to do this necessarily in December; you could do it anytime of the year, as long as it’s just the once per year.
Here’s background to why you get the tax back on the Xmas parties and also on trivial benefits (an alternative idea to the xmas party):