Jennifer Adams considers the potential for Christmas or other annual functions plus staff gifts to be tax-free.
Spending £150 per head (inclusive of VAT)â¯on an annual staff function is quite common these days. However, by combining this exemption with the ‘trivial benefits’ exemption, it is possible to exceed the £150 per head limit without triggering any tax implications.
The limit may also be surpassed if the event is combined with a promotional event held for potential customers, for costs which are charged on a ‘per head’ basis.
Annual parties and functions
It is important to note that the £150 limit is not a tax-free allowance but an exemption. Therefore, should the amount be exceeded (even by £1), then the whole amount is taxable, not just the excess over £150. The limit can be used to cover two
