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NO NEED TO BE A SCROOGE BOSS THIS CHRISTMAS

There’s isn’t an employee in the land who would want to work for Ebenezer Scrooge of Charles Dickens' novel A Christmas Carol. The cold-hearted miser, who despises Yuletide cheer, even begrudges his poor clerk Bob Cratchit paid leave on Christmas Day!

UK bosses of course are far more enlightened: and while their main motivation for wanting to give staff a little something extra at Christmas may be to recognise and reward them for their hard work, they can also benefit from some tax breaks along the way with a little smart accounting…

THE OFFICE PARTY

A staff Christmas party (or any other annual function) qualifies as a tax-free benefit for employees up to a cost of £150.00 per head. That means it will not be considered a ‘Benefit in Kind’ for the employee (which could have tax implications for them), and the cost of the whole event is tax deductible from the employer’s point of view. In other words, it's win:win. The event has to be open to all the staff based at a particular location to qualify.

PRESENTS FOR STAFF

There is an annual ‘gift’ allowance of up to £50 per employee which businesses often choose to use at Christmas. It can’t be given as cash, but wine or hampers are a popular choice by many firms, and vouchers for high street stores or meals out also qualify. The latter may be a safer choice as people have different dietary requirements and preferences.

LONG SERVICE AWARDS

An additional £50 worth of gifts or vouchers can also be given to staff in recognition of long service. The HMRC guidance allows for this after the first 20 years of service and again after each additional 10 years.

TREATS FOR CLIENTS

Christmas is also a time when many organisations like to thank key clients for their custom and support over the previous 12 months. This is regarded as a legitimate business expense. It can take the form of entertainment such as meals out, gifts such as wine or chocolates, or even branded items bearing the gifting company’s name – just to help keep them at the forefront of the customer's mind… So, if you want to be Santa Claus rather than Ebenezer Scrooge this Christmas, why not summon the spirit of Christmas Present (our very own Cheshire accountants, taxation expert Paul Edwards) for a no obligation chat by emailing him at Paul.Edwards@affordbond.com

AND A VERY MERRY CHRISTMAS TO ALL!