Assessment 2 Task 1.3

missmaya89

This task asks to show taxable amounts for Foday.
Foday attended the financial year end staff party costing the employer £120 per employee.

The answer is that the taxable amount is £100. I don't understand why? If the employer paid for this, why should the employee claim the tax? Or is it that the employee is expensing this cost and they are expensing the net amount ?
Can someone explain please?

PeterC

Staff party questions are usually about benefits in kind. However, this party looks as if it would qualify for the £150 exemption. Was there any other relevant information in the question?

andysmith72

You’re only allowed one party,he had two, they charge the cheapest

douglasstroud

> @andysmith72 said:
> You’re only allowed one party,he had two, they charge the cheapest

This is incorrect, you can have as many functions as you like throughout the year as long as they do not go over the £150 per head in total.

andysmith72

https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim21691

Yes of course, the breach of the £150 is the main point,not the no.of parties ,the example above took a bit of finding