All Work and No Play?
All businesses rely on the performance of their staff to achieve the best results. An efficient and reliable workforce is the backbone of any enterprise and probably it’s most significant asset. As such, many proprietors realize the advantages of occasionally rewarding employees outside of their pay packets.
To celebrate the company’s 15th birthday, the boss at Cardiff-based credit reporting company, Creditsafe, recently took 500 of his employees on an all-expenses paid trip to Majorca at a cost of £300,000. A company spokesman said the trip was ‘worth it for the “buzz” it created in the company’. Although not every employer can afford to be so generous, it is possible to arrange for a treat for your well-loved workforce and have the cost allowable for tax relief.
Each year a business can currently spend up to £150 on hospitality per employee, which can be allowable for relief without the employee incurring a benefit in kind. Providing a tax free reward can not only improve morale and productivity, but also provides a social environment to encourage camaraderie and a congenial working atmosphere – all of which are proven to enhance employee performance. Whilst the traditional Christmas Party immediately springs to mind, there are other more innovative ways to indulge your staff in some R&R. Sporting activities, cultural outings, fun days and team building exercises can all be included under the umbrella of hospitality. (The tax relief allowed only relates to employees themselves however – any additional costs incurred when including friends and family, or even subcontractors, in such an event would not qualify as deductible for tax purposes.)
The old adage of not mixing business with pleasure is becoming as out of touch as the working life of Bob Cratchit, when even an unpaid half-day off for Christmas was an inconvenience to Mr Scrooge. As Mark Twain once said, “Work and play are words used to describe the same thing under differing conditions”. So perhaps it’s worth taking a moment to evaluate how much the loyalty and dedication of your workforce empowers your business and acknowledging that worth by offering some tax-free play time.
Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.
Image courtesy of Stuart Miles at FreeDigitalPhotos.net
