Parties with business partners
If a party is held to present the company and its results, the costs of organising it relate to the company's business activity. Such costs are tax-deductible. You can therefore deduct venue hire, printed invitations, service staff — everything needed to organise the event. Be careful: hospitality costs are not tax-deductible.
Employee parties
The first option is a party purely for employees' entertainment, with plenty of food and drink. Their attendance is exempt income in kind. The exemption requires the party to be open only to a limited group of people, typically employees and their families. All your costs for such a party will be non-deductible.
However, if you treat the gathering as internal training, a meeting or a presentation of company results, you can deduct the costs of organising it. Deductible costs mainly include venue hire and the training itself. All food and drink are always non-deductible.
Documentation is crucial for these types of party and can save you uncomfortable explanations and efforts to remember everything that happened. It is useful to have, for example, a training attendance sheet, the presentation or meeting minutes. Ideally, keep clear photographic documentation showing the relevant “tax-deductible” activity.
If you have further questions, do not hesitate to get in touch before organising your next party. 🙂