Christmas celebrations and gifts can offer tax advantages for businesses. However, according to experts, their deductibility depends on the recipient, the purpose and the applicable tax.
Hampers, dinners and gift cards
Hampers, dinners and gift cards for employees may be deductible under IRPF or Corporate Tax when it is proven that they form part of the company's customary practices. Gifts to staff may need to be treated as remuneration in kind.
VAT deductibility has specific restrictions: food and drink hampers intended for employees or clients do not allow VAT to be recovered.
Lottery tickets and commercial gifts
Lottery tickets given to clients may be accepted as business hospitality, provided they are duly justified and fall within the overall limit of 1% of turnover.
Seasonal greetings and small promotional items may also be deductible. For VAT purposes, the latter must meet specific conditions, such as carrying advertising and respecting the limit of 200 euros per recipient per year.
Documenting every expense
Experts recommend keeping invoices, recording expenditure and proving its connection with the business activity. Where regularity is required, it is also advisable to keep supporting documents from previous financial years.