Christmas Party - is it worthwhile inviting a homeless person in to your party?

Sometimes the rules for Christmas parties are not quite what they seem

It is that time of year when goodwill flows, but you are only allowed to spend £150 per employee in the whole year ..... or are you?

I have just seen an amusing exchange on a business forum about the subject

The first question was

Good morning

Sole director is planning to hold his Christmas annual party with 3 other members of his family (also shareholders). The cost will be under £150 per person.

Provided this is an annual event I understand a staff party for the sole director would be allowable for tax but here would a BIK arise? I can't find whether there is a limit on number of guests per staff.

Could it be argued that it is not W+E for the business and disallowed for tax?

To this there was a flurry of incorrect answers like

The cost would have to be under £150 per staff member, not per attendee, ie under £150 in total.

until someone said correctly

I always thought the limit was per head - i.e you divide the whole cost by the number of attendees (staff and guests).

and another followed up with an unusual reply

Correct - which is why the advice to employers is: if your cost per head is marginally over £150 per head, invite in a tramp off the street and give him a drink and a piece of cake.

This cynical view amused me, and is not wrong,  but the correct answer is slightly more complicated - however it is explained very well in a comprehensive but old article that appeared in The Telegraph in 2005 , and I enclose the link here

As always , if you are still not sure , contact me and either I or one of my team will clarify for you

In the meantime, eat drink and be merry (within the limits) and maybe do good for you and others by inviting one or two extra guests who will appreciate it :-)

And may I take this opportunity, on behalf of my colleagues at OBC, to wish you a healthy, prosperous and happy new year in 2018

Michael Ogilvie

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