Christmas party expenses

[RichardCranium]

Why is it that whenever we get a new accontant on here the contractors always ending up giving them more advice then they give us?

Maslins is an accountant? Well, they provide crap advice. 'Probably', 'might', 'apparently be more relaxed', ' I guess', etc.

Oh, FFS.

... goes back and reads Maslins comments ...

Oi, Maslins. If you're an accountant, you're f***ing useless. You haven't provided a single straight comment to what was some straight questions. Instead of obfuscating and then having to apologise later in the thread for your own mistakes, just say nothing. You're not helping.

[swamp]

Maslins is an accountant? Well, they provide crap advice. 'Probably', 'might', 'apparently be more relaxed', ' I guess', etc.

Oh, FFS.

... goes back and reads Maslins comments ...

Oi, Maslins. If you're an accountant, you're f***ing useless. You haven't provided a single straight comment to what was some straight questions. Instead of obfuscating and then having to apologise later in the thread for your own mistakes, just say nothing. You're not helping.

+1

Maslins is useless.

http://www.hmrc.gov.uk/employers-bul.../empbull15.htm

Q I'd like to let my employees bring their partners along to the party. What are the rules for this?

As long as the cost per head of the function is £150 or less, there is no taxable benefit for the employee. If the cost per head exceeds £150, for a director or employee earning £8,500 a year or more the cost of the party for both the employee and their partner is subject to tax and Class 1A NICs. You would need to show it on the form P11D for the employee at section N.

For example, if an employee attends with his/her partner an annual event to which the exemption applies, and the cost per head is £100, there is no tax charge. On the other hand, if the cost per head of the event is £175, the employee is taxed on a benefit of £350.

Q How should I calculate the cost per head?

It is the total cost of putting on the function including accommodation, transport, food, drink and so on divided by the total number of guests including non-employees.


Swampette and I shall enjoy a (sub) UKP300 Christmas party!

[tim123]

Company employees only.

When big firms have parties with partners (guest) allowed, they have to disallow the proportion that relates to the partner.

No they don't

tim

[TheFaQQer]

No they don't

tim

That's almost what I said:

Bollocks.

[mudskipper]

OK - I think there is conflicting advice all over the place - it seems to be far from straightforward.

My initial question (whether I can go for a meal with my mates and claim my bit is a party) looks like a no-no.

But if I can prise hubby away from the telly for a night, we can go for a nice meal with a bottle of wine or two and call that my annual party and that looks as if it should be OK.

Or I can decide it's all looking like more hassle than it's worth and forget the idea!

[TheFaQQer]

OK - I think there is conflicting advice all over the place - it seems to be far from straightforward.

My initial question (whether I can go for a meal with my mates and claim my bit is a party) looks like a no-no.

But if I can prise hubby away from the telly for a night, we can go for a nice meal with a bottle of wine or two and call that my annual party and that looks as if it should be OK.

Or I can decide it's all looking like more hassle than it's worth and forget the idea!

Yes.

[Maslins]

Lots of hostility on the forum tonight...

Swamp - that's talking about the benefit in kind element again, not whether it is allowable. IMO mates (who aren't employees) will make it disallowable (per BIM 45033):

Where an employer provides a staff Christmas party, or a sporting event which is open only to employees, the expenditure is not disallowed by Section 577. However, it is still necessary to establish that the expenditure is wholly and exclusively for the purpose of the business.

In practice the definition of ‘employees’ is extended to include retired members of staff and the partners of existing and past employees.

Mates are not employees, so unless they're past employees, or partners of employees, it's not allowable.

From Swamp's post

For example, if an employee attends with his/her partner an annual event to which the exemption applies, and the cost per head is £100, there is no tax charge. On the other hand, if the cost per head of the event is £175, the employee is taxed on a benefit of £350.

Yup, I was wrong here. Seems if you go over the £150 then the partner's portion does get added to yours, but if you alone are under £150, and combined with your partner over, then you're ok.


Based on this, you can take your spouse out for up to £300 combined, and it will both incur no benefit in kind, and be tax deductible. Though note BIM 45033 specifically mentions the wholly and exclusively test, which is debatable for husband & wife only meals.

Please guys, cut me some slack. Like the rest of you I'm simply trying to provide assistance as best I can. I'm also intrigued as to whether Sally gets an answer re: only 1 director, as potentially that'll throw all this out of the water for contractors (probably due to the wholly & exclusively test).

[blacjac]

Your own quote says "which is open only to employees"

Which is the exact opposite of what we are all talking about!

[blacjac]

Maslins is an accountant?

You'd know that if you had avatar's turned on

(or if you have, if you looked at them - there really are some interesting ones around. Not Maslins though that's quite dull)

[Maslins]

Your own quote says "which is open only to employees"

Which is the exact opposite of what we are all talking about!

That quote is not my own, it's from the HMRC manual on staff entertaining. If you invite non-employee mates along, as some are suggesting, it's pretty clear cut that the cost is disallowable per BIM 45033 as it is not staff entertaining. If the cost is under £150/head there won't be any benefit in kind issues for the attendees who are employees, but the cost of the party will still be disallowable for the company.

BIM 45033 says HMRC will consider ex-employees and partners of current/ex-employees to be employees for this purpose, so your partner, and your mate who used to work with you along with their partner can come provided you can justify it's wholly & exclusively for the benefit of the trade. This is where it's open to interpretation.

I personally think a husband and wife will have a hard time to argue the only reason they went out for a posh dinner was to benefit the contracting businesses. I think this is essentially what Sally asked HMRC yesterday, so perhaps today she'll get a response that will give HMRC's view.