What you need to know about making claims. Tax deductible or not?

Expenses 50% Deductible

• Friday night drinks for team members or clients in the office.
• Friday night drinks for team members or clients in the pub.
• Hire of a launch to entertain clients.
• Restaurants providing food and drinks to team members at a social function in their restaurant.
• Sponsoring local sports teams and receiving tickets to their corporate box in return. 50% of the value of the tickets would be deducted from the total sponsorship.
• Sponsoring a sports team by providing a meal for the team at their grounds after each game.
• Staff Christmas party on or off the business premises.
• Taking a client out to dinner while you are out of town on business New Zealand.
• Taking a client out to dinner.
• A weekend away for the team at holiday accommodation in New Zealand. Includes any food and drink provided.

Expenses 100% Deductible

• Dinner for Sales Rep while out of town and no client present.
• Donating food to a Christmas party in a children’s hospital.
• Providing entertainment, including food and drink at your promotional stand for the local Christmas Festival open to the public.
• Employee’s salary package includes a taxable allowance for entertaining clients.
• Golf club subscription for business owner paid by the Company.*
• Gym membership for team member paid by employer.*
• Providing a meal for a journalist while reviewing your business for their column.
• Providing morning and afternoon tea for your team.
• Sandwiches provided at a lunchtime meeting of supervisors.
• Sponsoring a local sports team.
• Taking a client out to dinner while you are out of town on business outside New Zealand.
• Holding the team Christmas party in Fiji.

*Note: Expenses incurred in providing golf club subscriptions and gym memberships to employees are 100% deductible and not subject to the Entertainment Expense 50% limitation. However, these expenses will be subject to Fringe Benefit Tax, therefore there will still effectively be a tax cost in providing this benefit.

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