A PARTY IS FOR LIFE, NOT JUST FOR CHRISTMAS

Christmas parties

The £150 per head limit applies to annual events (not just at Christmas) that are open to staff generally. The total cost of the function (including VAT) is divided between the number of persons attending (staff, guests of staff, or guests of the employer). If the average cost per head exceeds £150, the whole cost is a taxable benefit. If more than one event is held during the year, the total needs to be looked at to ensure the £150 limit is not breached. Employers need to establish which events are the most tax effective to pay for.