With the Credit-Crunch denting the Government’s pockets, there may be a lack of cheer this Christmas
ACCA (the Association of Chartered Certified Accountants) urges businesses to ensure they are aware of taxation rules so that Christmas parties remain celebrations and do not become an extra burden on businesses already under considerable pressure.
ACCA’s head of taxation, Chas Roy-Chowdhury, urges business owners and workers to familiarise themselves with HM Revenue & Customs’ rules that will prevent Ebenezer Scrooge from ruining the festive fun:
• Parties must be open to all staff
• A maximum of £150 can be spent on each employee
• This amount covers entertainment, accommodation, venue, transport and VAT
• There may be 1 guest per employee, each of whom are entitled to a £150 exemption
• If this limit is exceeded then the full amount spent, not just the amount over £150, will be subject to income tax and NIC payments.
Chas Roy-Chowdhury says: “This issue demonstrates how the financial downturn could have across business and it will be interesting to monitor whether there is a sharp decline in the number of companies that decide to put a stopper to festivities this year. Barclays Capital is one major organisation that has announced that they will not be holding an office party this year.”
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Notes to Editors
1. ACCA is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. We have 325,000 students and 122,000 members in 170 countries worldwide.
2. ACCA has worked with governments, national organisations and development agencies in emerging economies- for over 20 years- promoting the accounting profession, to create value for the communities, businesses and individuals it serves.
3. ACCA believes that globalisation of business means that one set of reporting standards is essential. We favour the principles-based IFRS.
4. ACCA understands the real issues facing small businesses as 63,000 of our members work in SMEs or small partnerships worldwide.
For further information please contact:
Chas Roy-Chowdhury, ACCA Head of Taxation phone: +44 (0) 20 7059 5976 mobile: +44 (0) 7710 707516
Hannah Blackburn, ACCA Newsroom Phone: +44 (0)20 7059 5989