Entertainment & Gifts

It is nearly Christmas time, and we know you are ready to celebrate the silly season in style with entertainment and client gifts. We do not want to put a dampener on the festive spirit but wanted to remind you of what you can and cannot claim as on entertainment and gifts for your business.

Santa should not be the only one writing a list? When providing entertainment to your staff or clients, make sure you keep a clear list of the following:

• The date on which the expense was incurred
• The names of the people involved
• The business they represent
• The reason for the entertainment, for example, a thank you or a potential new client meeting

You may also like to give your clients a gift at Christmas time. The deductibility of this gift will depend on the type of gift you give. If the gift is one that relates to entertainment (food and beverage) then it will only be 50% deductible.

Below is a list of potential gift ideas and their tax deductibility. If you would like to know on how to treat bonuses and gifts to team members see our article: Christmas Bonuses & Gifts – Tax Implications

Gift & Entertainment Guide

50% Deductible Gifts & Entertainment

• Bottle of wine or beer
• Meal voucher
• Basket of food and beverage items
• Box of chocolates or biscuits
• Christmas ham
• Friday night drinks for staff or clients in the office or at a venue
• Meal at a restaurant for staff or clients during a social function
• Taking a client out for a meal at a restaurant

100% Deductible Gifts & Entertainment

• Providing morning and afternoon tea for your team in the office
• Calendar
• Book or Gift Voucher
• Tickets to a rugby game (but not corporate entertainment)
• Movie tickets
• Gifts (non-food or beverage)

Please contact us if you require further clarification.

If you would like to know more about what other expenses are tax deductible, see our article: What expenses are tax-deductible in NZ?

Carolyn Milliken