Claiming Christmas Expenses

31 January 2018

It’s always good to be aware of what’s claimable, here’s a quick list of Christmas expenses you can claim. 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 of Food, Wine and Other Gifts to Staff
Each quarter or a year there is a fringe benefit tax exemption of $300 per employee – so as long as your gifts of food, wine or other gifts to staff are under this $300 for the October to December quarter, 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 Colleagues
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.