Claiming Christmas Expenses

12 November 2020

Claiming Christmas Expenses

It’s always good to be aware of what’s claimable, here’s an overview of claiming Christmas expenses for your business. Please note some expenses are 100% deductible while others are only 50% deductible.

Staff Christmas Party

The costs of food & drink and any incidental expenditure relating to things like hireage of crockery, glassware, music or other entertainment is only 50% deductible for income tax purposes – this applies whether the party is held on the business premises or off site.

Christmas Lunch/Dinner for Colleagues

The cost of taking colleagues out for and end of year lunch or dinner will generally be 50% deductible.

Gifts to Staff or Clients

The cost of gifts (other than food and beverages) to staff or clients will generally be 100% tax deductible. Food, Beverages and Supermarket vouchers are deemed entertainment and only 50% deductible.

As long as your gifts to staff are under $300 for the October to December quarter, and not food and drink, the costs will be 100% deductible. If they are over the $300 then FBT will be payable to IRD, however the costs can still be claimed as well.

Gifts of Food and Wine to Colleague

The cost of gifting food and wine to colleagues will generally be 50% deductible for tax purposes.

Other Gifts to Colleagues

The cost of gifts (other than food and beverages) to colleagues will generally be 100% tax deductible for tax purposes.

Cash Bonuses for Staff

These must be included in the employees wages for the week and PAYE paid on them.

If you are planning on claiming for any expenses, please let us know what any Christmas related expenses are for so we can ensure the correct claims are made.


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