Can you claim back VAT on a staff Christmas party?
Written by
Bella Jolly
Brand Lead
With 10 years' experience working in brand and content for some of the UK's biggest hospitality brands under her belt, Bella takes ownership of the Togather brand. Bella's passion for the events industry shines through in her work, ensuring the stories of amazing suppliers and unforgettable events are effectively communicated through various mediums such as video, photo and the written word.
Outside of work, she can be found scrolling TikTok or enjoying a spicy margarita.
Published on Mon 2 October 2023
If you or your team are getting a head start on planning the Christmas party, there are a whole host of things to consider, from venue to menu - and each of them throws up a new stream of questions. The one on everybody’s lips this festive season: can you claim VAT back on a work Christmas party?
Entertaining your staff is tax deductible - but there are some rules and regulations you’ll need to be aware of when planning your Christmas party.
First of all, it’s worth noting that staff perks are not tax deductible, which means there are a few things to be aware of to keep your party exempt from benefit-in-kind tax. Your event must:
Cost £150 per head or less - note that this is not per event, but for all annual functions
Be an annual event, like Christmas party or a summer gathering, rather than regular entertaining over the course of a year
Be open to all employees - it is of course not mandatory for everybody to attend, but everybody must be at least invited
One final - and crucial - point to note is that you can only claim back VAT for a staff Christmas party that is specifically for your team members. If your party is really to celebrate with and entertain customers or clients, with your staff there too, you will not be able to claim back your tax.
N.B. Whilst we believe the information contained here is correct, we are not tax advisors and you should take professional tax advice specific to your circumstances.