Business Gifts to Customers or Clients

The costs of providing a gift carrying a conspicuous advertisement for your company or business, and which is not food, drink or tobacco, or a token exchangeable for goods, and which costs no more than £50 in total in your accounting year (per recipient) is an allowable expense.

In other words, pens, diaries and other pretty uninteresting gifts. Sometimes you may consider it better to give a good customer a gift they would appreciate and accept that the expense will not be an expense for tax!

Gifts to Employees

Small gifts to employees

An employer may provide an employee with a small gift, such as an arrangement of flowers. As long as this is made in recognition of a particular event (e.g. an employee’s marriage or birth of a child), and is not part of any reward for services, the benefit should be treated as trivial.

Seasonal gifts

An employer may provide employees with a seasonal gift, such as a turkey, an ordinary bottle of wine or a box of chocolates at Christmas.

If the gift extends beyond one of the items mentioned above, for example from a bottle or two to a case of wine, or from a turkey to a Christmas hamper, you will need to consider whether the benefit is still trivial.