Tax Doesn’t Have To Be Taxing!
When it comes to tax, it’s not every day you can enjoy tax free benefits, which, incidentally, also apply to Summer activities… Here are 2 great benefits you can take advantage of right now!
A Staff Summer Party Can Be A Tax-Free Benefit
Your organisation may have an annual Christmas party for staff, but the tax rules also allow staff parties at other times of the year, which are a tax-free benefit, if certain conditions are satisfied. The exemption applies to an annual party (for example, a Christmas party. Or similar annual function (for example, a summer barbecue), provided for employees and is available to all employees. Or it is available to all employees at that location, where the employer has more than one location. If the employer provides two or more annual parties or functions, no tax charge arises in respect of the party, or parties, for which cost(s) per head do not exceed £150 in aggregate. For each function the cost per head should be calculated. The cost per head of subsequent functions should be added. If the total cost per head goes over £150, then whichever functions best utilise the £150 are exempt, the other is taxable.
Make School Holidays Easier with Tax-Free Childcare
Did you know there is a government scheme available that can help contribute towards childcare costs? Which may mean fewer of your employees will need time off at the same time this summer. Tax-Free Childcare is a scheme available to working parents, with children from 0-11 years, and many parents are not taking advantage of the scheme. HMRC has said it would welcome help from employers in changing that. So please tell your employees about Tax-Free Childcare, and how it can reduce their childcare costs. Eligible parents can get up to £2,000 per child, per year to spend on qualifying childcare (effectively a 25% top up). Note that Tax-Free Childcare isn’t just for everyday childcare costs, such as childminders and nurseries, parents can also use it to pay towards the cost of:
- After school clubs
- Summer camps
- School holiday activities