Entertaining

[Bengal]

Clue is kind of in the question really

D'oh! Teach me to look properly next time!

[blacjac]

Are there any hard and fast rules about the frequency, amounts etc for client entertainment?

Depends on what type of entertaining you are talking about. Is it staff entertaining (ie employees) or business entertaining (ie clients)?

Clue is kind of in the question really

[Bengal]

As to Employee entertainment, does 'employees' include your company secretary to whom you pay no salary or income of any sort? Or should be paying the secretary a nominal amount so they are 'employee'?

A Company Secretary is an office holder (similar to a director) within the business and is therefore treated as an employee. And no you don't have to pay them anything if this is agreed with them. If you do pay them anything then this would have to be paid under PAYE (unless its dividends).

[EchoSierra]

It's frowned upon. You are entitled to one/many event(s) per year which most account to no more than £150 per head (per annum) and all employees must be invited. They can bring thier spouses/partner.

As for a general piss up, you can have as many as you like - you can't claim them from the business though and they will be taxed in full

As to Employee entertainment, does 'employees' include your company secretary to whom you pay no salary or income of any sort? Or should be paying the secretary a nominal amount so they are 'employee'?

[Pondlife]

As for client entertainment, my Accountant has advised that you must be able to demonstrate there was a chance you could win business from doing it (or not loose business), and that the VAT is not reclaimable, but apart from that go for it.....

Whilst it is payable by the business I doubt it offsets against corp tax.

IANAA etc

[Bengal]

Are there any hard and fast rules about the frequency, amounts etc for client entertainment?

Depends on what type of entertaining you are talking about. Is it staff entertaining (ie employees) or business entertaining (ie clients)?

If, staff then as tino has stated there is an exemption for particular types of staff entertaining and the expenditure and event have to meet specific criteria, as follows:

1. The event must be open to all employees (note not all employees have to attend it is sufficient that all employees are invited.

2. The event must be of an annual nature (ie christmas party, summer BBQ etc.)

3. You can have as many annual events as you wish in the tax year and if the total cost per annum per head does not exceed £150 a tax charge will not arise and the cost will also be deductible for corporation tax purposes.

4. If say you had two events and the total cost came to, say, £250 (ie one cost £150 and the other £100) then you can use the exemption against the £150 event but a benefit-in-kind tax charge will arise on the £100 event. Both costs will however still be deductible for corporation tax.

Any other types of staff entertaining will be caught for tax purposes.

As for business entertaining, you can have as many as you want, provided that the entertaining is to further the business (and not just a jolly for you and your mates). The cost is not, however, deductible for corporation tax and if the cost has not been disallowed for corporation tax then potential a tax charge can arise on the employee.

[blacjac]

It's frowned upon. You are entitled to one/many event(s) per year which most account to no more than £150 per head (per annum) and all employees must be invited. They can bring thier spouses/partner.

As for a general piss up, you can have as many as you like - you can't claim them from the business though and they will be taxed in full

That's employee entertainment, not client entertainment.....


As for client entertainment, my Accountant has advised that you must be able to demonstrate there was a chance you could win business from doing it (or not loose business), and that the VAT is not reclaimable, but apart from that go for it.....

[tino]

Are there any hard and fast rules about the frequency, amounts etc for client entertainment?

It's frowned upon. You are entitled to one/many event(s) per year which most account to no more than £150 per head (per annum) and all employees must be invited. They can bring thier spouses/partner.

As for a general piss up, you can have as many as you like - you can't claim them from the business though and they will be taxed in full

[Crusoe101]

Are there any hard and fast rules about the frequency, amounts etc for client entertainment?