Tax Deductions: Entertainment
Posted 10 Dec '15
Posted 10 Dec '15
It’s annual Christmas party time for you, your staff and clients, but before you get stuck into the Vodka Cruisers and Jager Bombs let’s make sure you’re up to speed on the taxman regulations for the festive season.
Generally, not one to walk around quoting tax legislation but it seems appropriate here (to show I’m not making this up); s32.5 of the ITAA 1997 has a big bold heading that states…
Say whaaaaaaaaaaaat?!
“Surely because I employ staff and these are my clients that I can take them out to say thanks and claim it as a business deduction…? That’s completely legit right?” [Quote from every client ever].
Unfortunately not my friends, the legislation has a pretty broad definition of entertainment…
You are taken to provide entertainment even if business discussions or transactions occur. (Examples: Business lunches, social functions)
I don’t think its PC to quote what clients generally say next about that little definition.
So the big question on your mind is what does this mean for your Christmas party function? Well there are 3 things we can suggest:
Before you think about throwing out a big “Bah, Humbug” on the Empire for dampening your Christmas spirit – Please don’t! We love Christmas and we love entertaining! We promise this isn’t the reason why you didn’t get the invite to the Empire Christmas party…Wow…this just got awkward…on that note, I think that’s a wrap for the year!
I hope you all a very Merry Christmas and a safe and happy new year. Thank you again for your support and kind words throughout this year. The Empire loves you and is looking forward to a very prosperous 2016.
Take care, Beth & Luke.
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