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Like 2020 as a whole, Xmas 2020 is going to look a bit different to how you would traditionally have chosen it to be with both your friends, family and business.
From yesterday, with the new tiering systems coming into effect, there are even more restrictions with what we can and cannot do, as we look to get on top of the Coronavirus pandemic.
Historic Xmas Party
Historically, company directors are entitled to provide an annual event for yourself, staff and your partner, and reclaim the costs, as long as the cost per head does not exceed £150 (including VAT), not even by a penny. The event must also be open to all company staff to attend and can include entertainment, food and drink, transport and accommodation and VAT. If it is a penny more than this cost, the whole amount will unfortunately become taxable so be sure to budget.
This expense can even be made up of several events throughout the year, including the Christmas Party, Summer social event and an incentive or reward event as long as it does not exceed this threshold.
However, as it is no longer possible for you to meet up as a team in person to celebrate, what are you going to do for your Xmas party in 2020?
2020 Xmas Party
Due to the current circumstances, HMRC have confirmed that virtual meetings will also be eligible for the annual function exemption, as outlined above of £150 per head.
Maybe this year you could use this exemption to do a virtual event such as a wine and cheese taster, gin tasting, fine cuisine comparisons or a quiz, to name but a few of the examples clients and colleagues of ours are doing.
What are you planning on doing for your Xmas Party 2020? We’d love to hear your thoughts and ideas.
Black and White Accounting
The above is a simple example of a tax exemption (or allowance) which is available and if used, you can effectively enjoy yourself (although maybe not this year in the same way you usually would) and save tax at the same time! Speak to us today to ensure you are minimising your tax bill with this and many other opportunities available to you.
Let us take the opportunity to wish everyone who celebrates a Merry Christmas and a Happy New Year. To those who don’t, we hope you enjoy the festive period and have a refreshing break. Our business will be closed from Wednesday 23rd December 2020 and will re-open on Monday 4th January 2021, but you know where we are if there is anything we can do to help you, especially at this most difficult of times.
