Would you class this as entertaining or an incentive?

Would you class this as entertaining or an...

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Hello,

This is my first time posting within this discussion and I'm hoping someone can help me? I'm a management accountant for a SME and struggling to decide upon the correct treatment of a recent transaction.   

My company holds an quarterly meeting by where all employees are invited to attend and the company presents the results of the previous quarter. Following the latest meeting the company provided lunch for all employees in the form of takeaway pizza - The COO paid for the pizza delivery and plans to claim this back on expenses. This is the first time lunch has been provided following these meetings however I have been told this will be repeated each quarter. I'm now debating with myself as how to treat this; incentive? entertaining? Miscellaneous? Although I don't technically believe this should be either. To put it into perspective the company employs roughly 50 employees and the pizza bill was around the £250 mark.

The company has a PSA Incentive agreement in place with HMRC to pay all tax/NIC on employee incentives - this covers meals, wine, vouchers etc which are awarded to employees for good performance. Given that all employees were given pizza for no real reason other than it being a popular nicety, I'm reluctant to report  this as an incentive. Likewise I don't really see this as a company event other than the fact that all employees were in attendance. I don't really want to have to take these quarterly meetings into consideration when calculating the yearly company event cost per head as this may or may not push us over the £150 per head exemption limit.

I may just be overthinking this issue but I'm going around in circles here so would be grateful for some input.

Thank you in advance

Kelly

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By Tim Vane
28th Jan 2016 13:20

Refreshments. It's just a meal. Nothing to report as all employees are invited. Enter it and move on.

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