Due to the pandemic there are various tier restrictions in place throughout the UK. This is impacting the socialising that is permitted, so it is highly unlikely that the usual workplace Christmas parties will take place, certainly for most of us.
Many clients have contacted me to ask if the £150 tax and NIC exemption that applies to social functions could be utilised elsewhere. Some have asked if it would be possible to use the exemption on a gift, hamper or voucher for employees in place of the usual company Christmas celebration.
It would seem that this has been considered by many employers, and so the Chartered Institute of Payroll and Pensions approached HMRC with these questions.
HMRC have confirmed that the exception that applies for annual events can only be used in line with current guidance and not for the purposes of providing vouchers or gifts etc., for employees.
Author: Sue Hancock