Just seen this on Gorilla's website, whoever wrote this needs firing, the advice is full of holes and makes little sense, especially if you are new to contracting.
"With Christmas just around the corner, it’s a good time to start considering whether or not you will be booking a Christmas party. As a contractor, you are entitled to host an annual event in the form of a Christmas party.
Can You Claim a Christmas Party as an Expense?
As a company director, you are entitled to host an annual event for yourself, any staff you employ and your partner. Each guest will receive an allowance of up to £150.
You are able to reclaim the costs against the company, however, you must not exceed £150 per guest as if you go over this figure, you will need to complete a P11D. You may then be liable to additional tax and national insurance charges.
The cost per head can include accommodation, transport and food and drink. With these factors included, the total must not exceed £150.
If you decide to invite your partner, who is not an employee, your partner will also receive an allowance of £150. If you are the only employee you will get a maximum £150 as a tax benefit, however if there are two employees then you will get a maximum of £300.
An Example
To help understand how a Christmas party can be claimed as an expense, please take a look at the following example.
Billy decides to have a Christmas party, Billy invites his wife, Kimberly as a guest. Kimberley is not an employee of Billy’s company, as his guest, Kimberley will also be eligible for the £150 allowance.
For this example, Billy can claim the full £110 for himself as an exempt expense and no tax is payable. This will then leave Billy with £40 left over from his £150 allowance."
"With Christmas just around the corner, it’s a good time to start considering whether or not you will be booking a Christmas party. As a contractor, you are entitled to host an annual event in the form of a Christmas party.
Can You Claim a Christmas Party as an Expense?
As a company director, you are entitled to host an annual event for yourself, any staff you employ and your partner. Each guest will receive an allowance of up to £150.
You are able to reclaim the costs against the company, however, you must not exceed £150 per guest as if you go over this figure, you will need to complete a P11D. You may then be liable to additional tax and national insurance charges.
The cost per head can include accommodation, transport and food and drink. With these factors included, the total must not exceed £150.
If you decide to invite your partner, who is not an employee, your partner will also receive an allowance of £150. If you are the only employee you will get a maximum £150 as a tax benefit, however if there are two employees then you will get a maximum of £300.
An Example
To help understand how a Christmas party can be claimed as an expense, please take a look at the following example.
Billy decides to have a Christmas party, Billy invites his wife, Kimberly as a guest. Kimberley is not an employee of Billy’s company, as his guest, Kimberley will also be eligible for the £150 allowance.
For this example, Billy can claim the full £110 for himself as an exempt expense and no tax is payable. This will then leave Billy with £40 left over from his £150 allowance."
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