A6.958 Entertaining

A6.958 Entertaining

There are a number of potential danger areas, including the following:

Incorrect use of the annual function exemption

The annual function exemption is available where an annual event is open to all and the cost per head is less than £150 including VAT (see E4.741A). The £150 is not an allowance.
Typical areas open to challenge by HMRC are business anniversaries, which are likely to fail the annual function test and specific team entertaining which is likely to fail the 'available to all' test.

Incorrect categorisation of business entertaining

Business entertaining will be an allowable expense for the employee when the employer's reimbursement of that

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