You either love office parties or you hate them but either way they could be tax deductible as long as you follow certain tax rules.
Those rules mean that you can spend £150 a head to treat your staff to turkey, all the trimmings and perhaps even a bottle of wine this year. As long as you stay within that £150 you will not be liable for any tax deductions and you can party away.
Even better news, if you happen to be a sole trader, is that you can spend the same amount on entertaining yourself and if you bring your wife or husband along they too are entitled to the same amount which means a combined £300. This should be enough to pay for a lavish Christmas dinner for you both.
According to HMRC the exemption from tax includes any annual event such as a Christmas party or summer barbeque. Unfortunately, the £150 exemption only applies as a total spend, so if you have more than one event and this comes to more than £150 then this won’t be exempt. Also you cannot offset if the bill comes to say £500 a head as the exemption isn’t classed as an allowance.