Festive savings for business

The festive season whether your business is slowing down for the festive break or these are you busiest months, we've pulled together some tax saving tips for spending over the Christmas period.

1. Christmas Party – Your office Christmas party can be claimed as a business expense of up to £150 per person (if this is the only function of the year), as long as the event is open to all employees. VAT is reclaimable for staff costs, not partners and not if the only attendees are directors (even if you have no employees)

2. Christmas Cards – Christmas cards, and other branded gifts or promotional material to customers, up to the value of £50 can be claimed as a tax deductible expense. These must be branded with company logo. Alcohol, food, drink, tobacco (unless that is your business) can be sent however this would not be tax deductible as an expense.

3. Employee Gifts – You can gift your employees small tokens e.g. a bottle of wine or a box of chocolates. If the gift is under £50 that can be claimed under the Trivial Benefits in Kind exemption and you won’t pay NIC or tax. However tax bonus and vouchers will be taxable along with the rest of their income.

4. Decorations – You will be able to claim tax relief on the cost of decorating your office with Christmas cheer (Unless you work from home, even if you have a dedicated office space). Christmas decorations and a tree for your office can be put into your accounts as day-to-day running costs, reducing the amount of profit you pay tax on. So bring out the tinsel, decorate the tree and light up your office with some festive sparkle.

5. Know your profit – Take time to assess your profit and loss. Your profit may be higher than you anticipated, meaning you can consider investing in capital purchases that will reduce your tax liability – So those tired office chairs could get a re-fresh for the New Year, plus the Christmas sales will save you money.

So as you plan your festivities bare these tips in mind, enjoy the festive break and take time off your busy schedule to spend with your friends and family. You've worked hard all year and a well-deserved break, and some quality time with your friend and family is a great opportunity to re-charge and set yourself up for the New Year.

For more tax tips follow us on twitter and if you're interested in setting your accounts and finances up to start 2018 right get in touch. We can advise on the right cloud accounting software for you and provide advice on growing your business that'll kick-start your business into the New Year.