Alternatives to the Office Christmas Party

The UK’s second lockdown ends on December 2. However, the Prime Minister’s recent announcement that the nation will face tougher ‘tiered’ lockdown restrictions beyond this date indicates that we will all have to play our part in limiting the spread of coronavirus before Christmas, Andrew Diver, head of taxation, explains.

The Christmas party is an integral part of the office calendar. Not only do they provide valuable team building, they also usually offer a tax-break which means that employees do not pay tax on the value of the party paid by the employer.

This year, with packed venues and tables for 10 implausible options, what can an employer offer their teams instead?

• Christmas Gifts – In 2016, HMRC formalised rules for ‘trivial gifts’. To qualify for tax exemption, a trivial gift must not be worth over £50, must not be cash or a cash voucher and cannot be provided because it is part of an employee contract or a reward for a particular service.
• Deferred Christmas party – The tax exemption for a Christmas party is not specifically for Christmas, but for annual events and up to a value of £150 per employee per tax year. Therefore, employers could simply decide to hold a delayed Christmas party, within the £150 per head value, in 2021 before the tax year finishes, when lockdown restrictions may not be as strict.
• Host a Zoom Christmas party – By hosting a Christmas party on Zoom, employers have the option to send food and drinks to employees for a shared experience. These gifts may fall under the £150 per head limit but attendance must be proved for them to be eligible – a screenshot of the Zoom attendees should suffice. With this increased budget, online entertainers such as comedians and magicians could be hired, or staff could take part in a quiz.

Employers can take advantage of the tax exemption of £150 per head at annual events as well as the trivial gift relief.

If you or your business needs advice or assistance about whether your Christmas arrangements this year will fall within these employee benefit exemptions, get in touch with Beatons Group by calling 01473 659777 or email info@beatons.co.uk to see how we can help.