Your organisation may have an annual Christmas party for staff, but the tax rules also allow staff parties at other times of the year which are a tax-free benefit as long as certain conditions are satisfied.
The exemption applies to an annual party (e.g. a Christmas party), or similar annual function (e.g. a summer barbecue), provided for employees. It must be available to all employees or available to all employees at a specific location, where the employer has more than one location.
If the employer provides two or more annual parties or functions, no tax charge arises in respect of the party, or parties, for which cost(s) per head do not exceed £150 in aggregate. For each function, the cost per head should be calculated. The cost per head of subsequent functions should be added each time. If the total cost per head goes over £150 then whichever functions best utilise the £150 are exempt, the other is taxable.
July 9th, 2019
