At this time of year, we get a lot of the following questions regarding Christmas Parties: Are Christmas Parties tax deductible? Am I being a cheapskate for not paying for a Christmas party? Why have a Christmas party at all? (This is Chris’s favourite question). Read on for all the answers, and perhaps a pleasant surprise.
The Boss loves Christmas, and so much so that the Ducketts office will be closed for the afternoon on Wednesday 19th December from 1pm, for the annual Ducketts Christmas lunch. He is however, insisting on being back at his desk by 3pm, we suspect productivity could be at an all year low.
The good news is that we will be open over the Christmas period (Excluding the Bank Holidays), it is Tax Returns season after all.
At this time of year, we get a lot of the following questions regarding Christmas Parties:
- Are Christmas Parties tax deductible?
- Am I being a cheapskate for not paying for a Christmas party?
- Why have a Christmas party at all? (This is Chris’s favourite question).
So, is a Christmas party tax deductible?
The short answer is yes, but there are some conditions;
- The party cannot cost more than £150 per person. Remember to take into account all costs in this figure and that it counts for the whole year not just a single event.
- The party must be an annual event such as a Christmas or summer party.
- The event must be open to all employees.
Please get in contact for the long version as it is a little more complex than this!
Am I being a cheapskate by not paying for a Christmas party?
The festive period can be an expensive time for anyone, whether you own your business or not.
Incentives and rewards provider All4one Rewards recently surveyed 2,009 UK workers and came up with the following:
- 76% of UK workers are being asked to cough up for their own Christmas party.
- 48% of Local and National Government agencies are choosing not to have one altogether.
In fact, many of the staff surveyed even thought that a Christmas party was the last thing that they needed at an already very busy time of year.
Why have a Christmas party at all?
While calling off the Christmas party and expecting employees to arrange their own festive frivolities may seem like a solution, the resulting effect on company morale and the perception of the business can have a negative impact.
- 1 in 3 workers said that if their employer didn’t provide a Christmas party then they would feel that the company didn’t value the workforce.
- 13% said that they would question how financially secure the business was.
When considering how to best motivate your employees, rewards are an important factor. Financial rewards can work well, but if bonuses aren’t possible then a Christmas party can be a cost-effective way of showing your employees appreciation and rewarding them for a job well done.
In the words of Richard Branson “If you look after your staff, they will look after your customers”. Happy employees make for an efficient and pleasant working environment.
If you have any questions regarding your business expenses or would like to find out how the Ducketts Team can help make your business more profitable and successful, please contact Martyn Wright on 01432 370572 or firstname.lastname@example.org.
Merry Christmas from the Ducketts Team