Tracey Norton, Senior Director
November 25, 2020 / UK
With COVID -19 restrictions still in place across most of the UK, traditional office Christmas celebrations won’t be possible this year. Therefore many employers are finding other ways to allow staff to celebrate together, with virtual party options including cocktail making classes, wine tasting, games nights and even Christmas dinner home deliveries.
For employers concerned about the tax treatment of these events, the good news is that HMRC have now confirmed that holding an event virtually will not prevent the costs from being covered by the tax exemption for annual functions.
How does the exemption work?
The exemption has been in place for many years, and means that no tax or national insurance contributions will arise on the cost of annual social functions for employees, provided the following conditions are satisfied:
Following HMRC’s recent announcement, virtual events will also be covered by the exemption, so long as the above conditions are still met…
Tags: alvarez & marsal, a&m, a&m taxand, taxand, tax, taxes, taxation, tax advisory, tax insights, tax consulting, tax professionals, tax firm, tax strategy, UK tax, tax exemption, HMRC, virtual Christmas parties