Clients puts on exhibitions and provides tea, coffee, juice, snacks etc to attendees. Is this client entertainment or just a cost of putting on the exhibition? Presumably if attendees bought their own, it would be tax-deductible as subsistence.
What if alcohol is also provided? Would that portion be entertainment? Would it make the whole lot entertainment? It is all billed on one invoice, but tea and coffee are itemised separately so I am guessing "beverages" is alcohol. It is definitely not a party!
Replies (7)
Please login or register to join the discussion.
If the attendees pay to go to the exhibition, then the cost of beverages is part of the pckage and is allowable. If the attendees are invited with no entry fee, I would be inclined to say that it is entertaining.
How about these ones?
So are the client's customers companies who are exhibiting at the exhibitions they put on? (And possibly also attendees?) And are the invoices you refer to received by your client, or are theyinvoices they send to their customers?
This link gives examples of what is and is not allowable for each company in the chain in promotional work.
http://www.hmrc.gov.uk/manuals/bimmanual/BIM45062.htm
It also indicates why tea, coffee, beverages etc might be itemised separately on the invoice - if they are reimbursed in full they are not counted as business entertaining by the company supplying them so are allowed for that company.
Also see BIM45030 and BIM45061
Quid pro quo
It is not entertainment. The customers have paid for their refreshments, as part of the cost for their stands. It does not need to be separately invoiced.
BIM45014 is the appropriate reference, although it refers to quid pro quo being provided in the performance of services. Quid pro quo can be provided in cash by the payment of a fee. If someone chooses to pay for a stand, but not be refreshed, that is up to them.
Whether they are refreshed with beer or water is irrelevant to the analysis, but not that both beer and water are beverages other than tea and coffee.
It's also worth noting that HMRC do overstate their case in their manuals, in my opinion. I don't think that the examples in BIM45062 are completely correct.