HMRC recently confirmed that virtual Christmas parties will come under the same annual exemption as face-to-face parties, meaning that an employer can spend up to £150 per employee on the event.
"As long as it's open to all employees!"
So, you could organise a black-tie zoom event, put on a DJ, get a magician doing some close-up magic on camera, send your employees food and drink (or maybe vouchers for their local takeaway) and even send them some gifts.
As long as the overall per-head cost stays under £150 per head, there's no tax due. If you exceed this value, the whole thing is taxable, not just the excess.
One other proviso is that any 'gifts' you send your employees can't be cash, can't be exchanged for cash or have a value of more than £50 either. It's always worthwhile putting a little thought into your gift choices if you can, but at the very least, send them an Amazon voucher a few days beforehand.
"Then they can have their gifts delivered in time for the virtual Christmas party!"
So, do thank your employees for their hard work during this very strange year, and let them eat, drink and be merry at your virtual Christmas party. Just don't spend more than £150 per head on them, then everyone can have a great time.
Until next time ...
Would you like to know more?
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Helen brings the personal tax planning experience of the top 20 tax companies to Essendon. Formerly of MacIntyre Hudson (with 45 offices nationwide), Helen worked at Chancery for more than 10 years before joining Essendon as the personal tax specialist.
Tax Planning can make a considerable difference to your tax liability. Helen has specialist knowledge and experience in tax planning and uses every opportunity to minimise your tax bill is utilised. By analysing your investments, income, profit and expenditures, Helen will provide strategic tax planning expertise that could offer significant savings, whilst delivering clear, honest advice and guidance.
When Helen is not at Essendon she spends time with her young son and likes going on long walks with the family dog.
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