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Entertainment and Parties

Read our guide to know about how you can claim tax relief for the cost of entertainment and parties through your limited company.

The limited company directors can also claim tax relief on the cost of parties and entertainment. Read our guide and know about how to host your own event for ensuring you can make the most out of the existing tax relief and allowances.

Claiming the cost of your party

The companies can claim the cost of annual events for employees as allowed by HMRC. This cost consists of food and drink, accommodation and transport.

You can even claim relief on the cost of annual company events if you’re a one-person limited company. You can get more information about how to claim limited expenses through our guide.

How much can I claim?

More than one event can be held every year subject to the total cost doesn’t exceed the £150 per head limit, you will be able to claim the tax back on this amount. You need to make it clear to HMRC in case if you hold more than one event in any given year as legitimate annual events as compared to ad hoc nights out for your employees.

What criteria will I need to meet?

You must comply with the following rules for getting exempted to pay tax or National Insurance to HMRC:

Business entertaining

The availability of corporation tax relief is not there for business entertaining. Whilst you can claim the costs through your limited company, they will not be tax deductible with respect to calculating the profits of your business.

In order to validate the cost of entertaining as a business expense in spite of the lack of corporation tax relief, you will be required to consider if the benefits obtained by the company will be worth the costs involved.

The customers’ gifts are not allowable as an expense and should be considered as business expenses unless they meet the below-mentioned criteria:

Examples of an Annual Party Exemption

How can Nexa Accountants help?

You can get the best advice on your finances whatever the occasion may be. Our specialist accountants will provide you with the support wherever possible. Contact Nexa Accountants team on: 020 3004 9303 to know more about claiming expenses.

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