Business gifts are items of value which you give away without any obligation to the person receiving them. They’re not normally eligible for tax relief, though there are exceptions.
Items given away for advertising
One of these exceptions is for items given away for advertising purposes. If the item’s value is less than £50, it may be eligible for tax relief.
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Giving away multiple items
There may be instances where a number of gifts go to the same recipient. In this case, the total value of the gifts should be less than £50 in one accounting period.
If the value of the gift or gifts is more than £50, then you’ll need to account for the VAT on these, unless the item is a business sample.
Gifts to employees
Gifts to employees are deductible in the company accounts, and you can also reclaim the VAT.
The tax treatment of business gifts is complex, and it’s essential to ensure compliance with HMRC regulations. Talk to our team to find out how we can help, or get started with an instant quote.
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MAAT and ICPA accountant, with a passion for making accountancy and bookkeeping accessible. Other interests include cloud-based software development for web and mobile access, keeping fit, reading, and entrepreneurship.