Top Tax Tips for Christmas
Christmas Gifts to Staff
Trivial gifts such as a turkey, an ordinary bottle of wine or a box of chocolates can be given tax free to employees but not lavish ones.
Long Service Award
Non-cash awards of £50 for each year worked can be given tax free to anyone who has worked at the company for over 20 years, provided no award has been made in the previous 10 years.
Gifts to Customers or Suppliers
Tax relief is available on gifts costing £50 or less provided they include a conspicuous advertisement such as a logo and are not food, alcohol, tobacco or vouchers.
Gifts to Charity
Your company’s gift is tax deductible provided it is given without conditions or material benefit. The self-employed can claim higher rate tax relief on charitable gifts on their tax returns.
Instead of the usual gifts or greeting cards for clients, staff and customers, why not buy a charitable gift and then design and send an e-card to let them know about it. It saves on postage and stationery and is tax deductible like any other charitable donation.
Christmas Bonus for Staff
This will count as ordinary earnings and be subject to tax and NI as if it were additional salary. Vouchers will also be caught.
Hospitality of any kind is never an allowable deduction and VAT cannot be recovered on it.