When planning your office party budget, there are some ways to save your employees money at tax time.
If costs don’t exceed $100 per person, your annual staff party won’t be considered a taxable benefit!
If you don’t plan your office budget carefully, the great intentions you had when deciding to throw an office party for your staff, will end up a costly expense in more ways than one.
“If the cost of the party is greater than $100 per person, the entire amount, including the additional cost, is a taxable benefit,” warns the Canada Revenue Agency.
“Additional costs such as transportation home, taxi fare, and overnight accommodation are not included in the $100 per person amount,” the CRA says. So you can make sure all your colleagues have a safe night in the hotel, or sober ride home, without costing anyone at more when they send in their returns come April.
When you’re costing food, drink, holiday gifts and other entertainment for the event, you don’t have to include HST or GST in your calculations, but you should include any gratuities to be paid while budgeting.
And don’t worry! Enjoying good company, celebrating your team, and having as much fun as possible are all benefits that, for the moment, remain absolutely and completely tax free!