Gifts to New Home Owners

T.C.

If a builder sends flowers to the purchaser of a new home, can he claim the cost of the flowers as an expense? :001_unsure:

Dean

The word 'gifts' should be answering your own question. Or alternatively, 'client entertaining'. I would show the cost in the accounts but add back on the comps.

Regards

Dean

T.C.

You don't think it could be classed as advertising then?

Dean

Would the company logo(s), slogan(s) be on the flowers?

I can see where you are trying to go with it but essentially it's just a goodwill gesture.

Regards

Dean

T.C.

Yes the company logo will be on the flowers - goodwill - yes, but advertising too!! This won't happen very often, so I think it must be worth trying for.

Dean

So the logo is actually on the flowers themselves? Are they artificial or something? :001_unsure:

If you can satisfy the 'advertising' conditions, and the cost is below £50, then that should be ok - see here:

http://www.hmrc.gov.uk/manuals/bimmanual/BIM45070.htm

However, note the final line...

The advertisement should be on the gift itself, and not just on the wrapping.

That is where I think the expenditure fails to be allowable.

Regards

Dean

Poodle

Hi

I agree with Dean, it is too remote.

I get the same problem but more often with gifts of flowers to staff (weddings, birthdays and leaving), a benefit or not?

Poodle

Dean

Poodle wrote: »

I get the same problem but more often with gifts of flowers to staff (weddings, birthdays and leaving), a benefit or not?

As per Section 201 ITEPA 2003

Section 201(1) ITEPA 2003 concerns “employment-related benefits”.

A benefit is defined in Section 201(2) as “ a benefit or facility of any kind”. When a benefit is provided to an employee (or to any member of his family or household (Section 721(5) ITEPA 2003) by reason of the employment ( EIM20501), it is an “employment-related benefit” (Section 201(2)).

What this is saying is that a benefit-in-kind will arise if it is in connection with the employees employment. In other words the employee must have given something by way of services for the employer to give them a benefit.

So in answer to your question I would say, no there aren't chargeable benefits but they also wouldn't be a specific deduction for the employer.

You've got to love tax legislation! :001_tt1:

Regards

Dean

Poodle

Hi Dean

This from HMR&C 480 Expenses & Benefits a tax guide

Trivial benefits

Strictly all benefits are subject to tax and NICs, unless there is a specific exemption. However,
sensible practical administration of the tax system determines that benefits of a trivial nature
(for example, a seasonal gift of a turkey or an ordinary bottle or two of wine) should not be charged
as a benefit. Anything more lavish in quality or quantity remains chargeable.
There is no monetary limit to determine what is a trivial benefit. A cash benefit, or a benefit with
a money’s worth, is never treated as a trivial benefit.

Depending on the value I have in the past treated as a 'staff benefit' but not a 'taxable benefit in kind' and allowed as tax deductable for the employer.

Love tax? that's why I am concidering ATT:eek::eek:


P

T.C.

Mmm. Dean. It satisfies all the criteria except for the bit about being on the item not the wrapping. Maybe I will leave this one out then. Thanks for all the advice.