Retirement Drinks taxable benefit

Is the benefit of a leaving event to the retiree or the attendees?

Didn't find your answer?

If a company provides say, £250 to put behind the bar for a retirement party to be attended by employees, would you think that this is a £250 taxable benefit received by the retiree (to be declared via PSA) or would you consider this to be various trivial benefits received by the employees who attended the party and therefore no tax to be declared and paid?

No single employee would have benefitted > £50 individually as it's just a drink or two each, but as usual I'm struggling to make heads or tails of the HMRC EIM. 

Replies (25)

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RLI
By lionofludesch
21st Jun 2024 15:52

[Edited.]

You know what? I'd just divide it by the number of employees attending.

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Replying to lionofludesch:
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By rmillaree
21st Jun 2024 16:02

i go with alcoholic on the basis i aint been to a dry party since i was 16

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By bendybod
27th Jun 2024 11:33

HMRC's own examples re trivial benefits gives an example of bottles of wine as being allowable.

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the sea otter
By memyself-eye
21st Jun 2024 17:03

How long did the 'retireee' work for the company?

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DougScott
By Dougscott
21st Jun 2024 17:35

There's always someone at the party who drinks more than £50 of drinks....

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Replying to Dougscott:
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By 17RDR12
25th Jun 2024 12:14

Dougscott wrote:

There's always someone at the party who drinks more than £50 of drinks....

Not before the £250 bar tab runs out I would hope!

Thanks all for your answers, I think I agree that the costs can be split per head

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By cinnamint
21st Jun 2024 17:52

I wouldn't class this as a benefit, what benefit are you getting by attending your own retirement booze up? Staff entertaining and be done with it.

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By Bobbo
21st Jun 2024 18:08

Staff entertaining of course being a benefit...

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Replying to Bobbo:
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By cinnamint
21st Jun 2024 20:36

It doesn't sound like it's more than £150 per head if it's £250 behind the bar for everyone.

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Replying to cinnamint:
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By Tax Dragon
21st Jun 2024 21:21

.oO Annual Retirement Day

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Replying to Bobbo:
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By FactChecker
21st Jun 2024 22:43

... and retirement not usually considered to be a regular event.

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Replying to FactChecker:
RLI
By lionofludesch
21st Jun 2024 23:31

FactChecker wrote:

... and retirement not usually considered to be a regular event.

Regular - maybe.

Frequent -no.

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By Tax Dragon
22nd Jun 2024 06:49

Regular, frequent... s264 uses the word 'annual'. My joke may not have been funny, but it was at least technically accurate.

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Replying to lionofludesch:
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By Bobbo
24th Jun 2024 12:20

lionofludesch wrote:

FactChecker wrote:

... and retirement not usually considered to be a regular event.

Regular - maybe.

Frequent -no.

Can be frequent if you're Gary Neville taking your "mini-retirements" https://www.youtube.com/watch?v=ofiRf1f3T5c

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Replying to Bobbo:
RLI
By lionofludesch
24th Jun 2024 12:31

Bobbo wrote:

lionofludesch wrote:

FactChecker wrote:

... and retirement not usually considered to be a regular event.

Regular - maybe.

Frequent -no.

Can be frequent if you're Gary Neville taking your "mini-retirements" https://www.youtube.com/watch?v=ofiRf1f3T5c

[chuckle]

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Replying to FactChecker:
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By C Graham
27th Jun 2024 13:01

Unless you're the leader of the Tory party

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the sea otter
By memyself-eye
21st Jun 2024 20:54

never worked for a company long enough to be retired (as opposed to sacked) thank god!

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By the_drookit_dug
23rd Jun 2024 10:13

It's a trivial benefit if it works out at less than £50 per head on average.

It's similar to the birthday dinner Example A in HMRC's manual EIM21865. (https://www.gov.uk/government/publications/tax-exemption-for-trivial-ben...)

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By bendybod
27th Jun 2024 11:34

HMRC's guidance says average it as it is impractical to figure out who ordered what.

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By C Graham
27th Jun 2024 12:49

Benefits - no. Giving up your evening to go to a work do and then listen to all the speeches about how amazing 'retiring' person is, will necessitate a bit of alcohol to get you through the evening.

Why would the retiree personally benefit if a party is held in his/her honour and everyone is invited to raise a glass? It's just staff entertainment. You cannot impose benefits on people when they are expected to attend and might not even stay long or have a drink.

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Replying to C Graham:
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By FactChecker
27th Jun 2024 14:53

"You cannot impose benefits on people when they are expected to attend and might not even stay long or have a drink."

... well you can - but you might experience a rapid increase in labour turnover!

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Replying to FactChecker:
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By C Graham
27th Jun 2024 15:19

Has to be listed as a contractual benefit and I doubt attending ad hoc company events outside working hours would stand up to scrutiny in an employment contract.

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Replying to C Graham:
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By Tax Dragon
27th Jun 2024 17:00

C Graham wrote:

Has to be listed as a contractual benefit...

...for what?

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Replying to Tax Dragon:
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By C Graham
27th Jun 2024 17:45

That was part of a longer conversation. It is meaningless to take it out of context.

A taxable benefit cannot be imposed without consent of the employee. If there is a contractual stated benefit (generic) eg employer funded healthcare then there is still the option for the employee to refuse it.

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Replying to C Graham:
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By Tax Dragon
27th Jun 2024 18:11

I'm not sure what point you are making. If an individual receives something and they would not have received that thing had they not held a particular employment, then there may be a BIK. Contractual compulsion is not one of the statutory tests.

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