What counts as a social function

[northernladuk]

But, saying this, do you have to have a decent reason? Rather than just bung a few meals out with the Mrs through every year (assuming its all less than £300).

I guess this is up to you. A few meals out with no reason whatsoever is pushing it IMO. There are enough instances to go out in a year with extensions, birthdays, company birthdays, yearly celebrations (St Georges day etc) to be clever enough to use these and not totally rip off the process.

Also, any implications with just being a Director and not an employee (as I am this year only)?

How can you be in contract and not an employee of your LTD?

[ASB]

How can you be in contract and not an employee of your LTD?

As a director (or co sec) you are an "office holder", not an employee. In order to be an employee in this circumstance you need to have a service contract which makes you an employee.

Edit: Didn't really answer your question, just drew the distinction. In answer to "how" it is because as a director you can undertake whatever tasks you please for the benefit of the enterprise; so doing employee like work is still covered.

[kingcook]

But, saying this, do you have to have a decent reason? Rather than just bung a few meals out with the Mrs through every year (assuming its all less than £300).

This financial year, i've had 2 events so far: to celebrate the waning gibbous of the Moon in October, and an xmas party.

I've got a bit of budget left for an end of financial year party in March too.

Exciting stuff!!

[Old Greg]

I've had a firm 'it's just for employees' from my accountant.

[TheFaQQer]

This financial year, i've had 2 events so far: to celebrate the waning gibbous of the Moon in October, and an xmas party.

I've got a bit of budget left for an end of financial year party in March too.

Exciting stuff!!

It's not a budget

It's an exception up to that limit. Go 1p over the exception limit, and you can't claim it.

[TheFaQQer]

I've had a firm 'it's just for employees' from my accountant.

That seems to contradict the advice from Clare earlier about claiming the VAT back:

You can claim back the VAT on the staff portion, assuming you're standard VAT registered, but not on the amount apportioned against guests.

That implies to me that both staff and guests can be invited.

[Clare@InTouch]

That seems to contradict the advice from Clare earlier about claiming the VAT back:

That implies to me that both staff and guests can be invited.

Yup, I disagree that it's just employees. I think it's per head, and that each head doesn't need to be an employee.

I also think that you should limit it to you +one, so as not to take the mickey out of the 'spirit' of the allowance.

[Old Greg]

Yup, I disagree that it's just employees. I think it's per head, and that each head doesn't need to be an employee.

I also think that you should limit it to you +one, so as not to take the mickey out of the 'spirit' of the allowance.

Thanks Clare. What do you base this on? The HMRC web page references to non-employees seem tangential to me, hence the doubt.

[Clare@InTouch]

Thanks Clare. What do you base this on? The HMRC web page references to non-employees seem tangential to me, hence the doubt.

From HMRC guidance:

Exemption not allowance
The figure of £150 is not an allowance. For functions that are outside the scope of the exemption (see example at EIM21691) directors and employees, except those in an excluded employment, are chargeable on the full cost per head, not just the excess over £150, in respect of:

themselves and
any members of their family and household who attend as guests.

The cost of the function includes VAT and the cost of transport and/or overnight accommodation if these are provided to enable employees to attend. Divide the total cost of each function by the total number of people (including non-employees) who attend in order to arrive at the cost per head.

EIM21690 - Particular benefits: annual parties and other social functions

[kingcook]

It's not a budget

It's an exception up to that limit. Go 1p over the exception limit, and you can't claim it.

It's a budget for me