It’s almost December and you still haven’t decided what to do for the team Christmas party. You’re tossing with a few ideas and you want to understand the tax implications a little better. You understand that generally speaking, when you provide your employees with entertainment (such as a party), then you need to pay an extra tax known as fringe benefits tax (FBT). However you will also want to understand whether your Christmas party is tax deductible?
The ATO’s view is that the cost of a Christmas party is tax deductible only to the extent that it is subject to FBT. As a result, Christmas Party costs that are exempt from FBT (where the costs relate to exempt minor benefits and exempt property benefits) cannot be claimed as a tax deduction. Continue reading “Is my Christmas party a tax deduction?”