Are Team Building Events Tax Deductible?

28 June 2022

Bluebird Care taking part in a team away day

Can you get tax relief on your next get together with the team?

Team Building is a necessity, but it can become expensive with tax on top of the cost per head. Luckily, HMRC does provide limited tax relief for hosting an annual event for your business. Your business must meet certain requirements, which you can find more information about here.

The deduction applies to ‘annual parties’ that are made available to all staff, even if your business is separated into different locations and departments, and your price must be £150 per head. This figure is inclusive of VAT.

In the words of HMRC, the cost of your ‘annual’ team building event includes everything from beginning to end including taxis, overnight accommodation, food and drinks, and location hire.

Your company may hold more than one tax-deductible ‘annual event’ each year, but the total claim for all of your events combined cannot exceed the given threshold. This means it’s up to the business owner or director to decide which event to make a claim on. Summer BBQ, Christmas party or celebration of events, it’s up to you!

They state that as long as the training ‘imparts, instils or improves or reinforces any knowledge or skills likely to prove useful when performing duties of any relevant employment.’ This could include skills such as creative thinking, teamwork and communication, so it is classed as job-related training.