Tax Deductible Gifts
what gifts are tax deductible through my company?
Generally business gifts to customers are not tax deductible as they are seen as entertaining costs.
ADVERTISING GIFTS:
If the gift costs less than £50 and includes a conspicuous advertisement for your company or brand, then this should qualify for tax relief. BUT there are some more conditions as follows:
• The gift must not consist of food, drink, tobacco or an exchangeable voucher.
• The advertising must be on the gift itself and not just on the packaging.
• Gifts must not exceed a total value of £50 to any one customer during the financial year.
STOCK GIFTS:
- If the gift is one of your products and given during the ordinary course of business to advertise to the public generally e.g. products you would usually give as a free sample.
In some circumstances a gift can be included as a tax-deductible expense.
Want to know the best way to deduct tax from your profit?
GIFTS UPON SALE:
- If an item is classified as part of the sale e.g. offered if the customer orders goods to a certain value- the value of the gift would be deducted as a discount.
CHARITABLE GIFTS FROM YOUR BUSINESS:
- If your business donates to a registered charity then this will be tax allowable.
- Gifts to employees may be tax deductible, however the rules for this can be complex.
- For more information and advice on this subject contact Woods Russell.
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