- VAT rules on entertainment and staff expenses can be confusing
- Some costs are fully reclaimable, others not at all, and sometimes only a proportion can be recovered
- Business entertainment includes client meals, tickets to events, and corporate hospitality
- VAT on business entertainment for non-employees is not reclaimable
- Staff entertainment for employees only allows full VAT reclamation
- Directors, partners, or sole proprietors do not qualify for VAT reclamation
- Mixed entertainment requires apportioning VAT between staff and non-staff
- VAT can be reclaimed on business travel, meals during work trips, and hotel accommodation for business purposes
- VAT cannot be reclaimed on commuting, private purchases, or personal benefit items
- Keep valid VAT invoices and separate client entertainment costs from staff costs
- Regularly review expense policies to ensure VAT compliance
- Proper invoicing and record-keeping facilitate VAT recovery
- Mistakes in VAT claims can lead to unexpected HMRC bills
Source: deeksvat.co.uk
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
