Christmas events in 2020 – tax and NI exemption

26 October 2020

The CIPP wanted to ask if, due to the current situation relating to coronavirus, the £150 tax and National Insurance (NI) exemption that applies to social functions could be utilised elsewhere as it unfortunately, becomes more and more likely that Christmas parties will not be able to take place this year.

Ordinarily, businesses are able to apply this exemption where a party or similar social function is hosted, and costs £150 or less per head, takes place on an annual basis, e.g. a Christmas party or summer barbecue, and where it is open to all employees of a business.

HMRC has 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 for employees.


The information in this article is accurate at the time of publication. For all the latest information, news and resources on how the COVID-19 pandemic is affecting payroll professions, visit our Coronavirus hub.