My builder client paid for his sub-contractors to attend the company (which is just him and his wife) Christmas function. Am I right in thinking that this should be classified as entertaining as they are not employees? Any thoughts?
Thanks
EL
Replies (1)
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Status issue !
Attendence at a "staff party" by labour only subcontractors is to be discouraged.
The phrase "part and parcel of the company" is what comes to mind with the status issue risk.
So:-
EITHER
(a) Disallowable as entertaining (if genuine subcontractors)
OR
(b) Allowable as staff party (if fail the status tests)
PS. To help fall into category (b) some contractors make the additional mistake of providing company vans to their "subcontractors". ? How hard are they trying to make "subcontractors" "part and parcel of the company" and risk PAYE/NIC liabilities ?