Annual Party

[crp]

Hello - As far as I'm aware the following statements are true:

• The limit is £150 per head for both employees and their partners
• VAT can be claimed back on the employee portion but not on the non-employee portion
• Corporation tax can be off set on both the employee portion and the non-employee portion

Does the event I have planned, essentially dinner with my fiancee, qualify because I'm a director of the (limited) company and there are no other employees on the payroll? In other words, the event is open to all staff and not closed off to directors only – it’s just in this circumstance I am the only member of staff.

Any advice much appreciated.

[Nixon Williams]

The 'event' should be seen as an annual event, commonly this is known as the Christmas party allowance as 99% of companies use it for this purpose.

Whilst it is unlikely that HMRC will enquire too much, there should be some sort of company event to justify it.

The fact that you are the only officer and there are no employees, does not matter, if the rules for the event are in place, you can indeed claim for upto £150 per person.

Note that you should not exceed this amount, otherwise the event is taxable.

If you are on the Flat Rate VAT scheme, no VAT will be reclaimable.

[northernladuk]

The OP's comment is not correct and is not clarrified properly by NW's response. You cannot claim for your wife. It is £150 per head of director or employee. If your wife is an employee then she can claim £150 making it £300 in total, if she isn't it is just £150

Contractors' Questions: Can my limited company fund a Christmas party? :: Contractor UK

E.g. 1/ John went out with his wife for his limited company’s annual Christmas Dinner and spent £130. His wife is NOT an employee, so the total they can claim – maximum - is £150. In this case, John can claim the full £130 as an exempt expense and no tax is payable.

[TheFaQQer]

Does the event I have planned, essentially dinner with my fiancee, qualify because I'm a director of the (limited) company and there are no other employees on the payroll?

As long as it's an annual event (or events) then it can qualify. If it's just a social occasion, then it doesn't.

So, if you plan a Christmas event, a spring event, a summer barbecue and an autumn event, then you are fine, as long as you don't go over the £150 per employee or director per year.

HMRC provides some fairly clear details here and here.

[northernladuk]

And remember as always with these things... You are only saving the tax, the rest still comes out of your pocket at some point.

[Craig at Nixon Williams]

The OP's comment is not correct and is not clarrified properly by NW's response. You cannot claim for your wife. It is £150 per head of director or employee. If your wife is an employee then she can claim £150 making it £300 in total, if she isn't it is just £150

Contractors' Questions: Can my limited company fund a Christmas party? :: Contractor UK

The exemption does allow each employee to take a guest to such an event as clarified towards the bottom of this page from HMRC EIM21690 - Particular benefits: annual parties and other social functions.

Hope this clarifies the point!

Craig

[northernladuk]

The exemption does allow each employee to take a guest to such an event as clarified towards the bottom of this page from HMRC EIM21690 - Particular benefits: annual parties and other social functions.

Hope this clarifies the point!

Craig

Yes, I read the OP was thinking it was £150 for him and £150 for his partner.

[Notascooby]

Yes, I read the OP was thinking it was £150 for him and £150 for his partner.

Ooops that's how I've always taken it - and put through and signed off in the accounts.

Oh well - lets see if Hector spots it

[Nixon Williams]

Yes, I read the OP was thinking it was £150 for him and £150 for his partner.

It is - the allowance is £150 for each officer and for each employee. On top of this if the employees are allowed to bring a guest, then there is an allowance of £150 for each of them.

So for most contractor companies, usually just one director and no employees, then the allowance would be £300, for the director and a 'guest'.

[northernladuk]

It is - the allowance is £150 for each officer and for each employee. On top of this if the employees are allowed to bring a guest, then there is an allowance of £150 for each of them.

So for most contractor companies, usually just one director and no employees, then the allowance would be £300, for the director and a 'guest'.

So the article I posted is wholly wrong? A lot of information linked around the web indicates a partner is includes in the £150.