Is Your Christmas Party Subject to FBT?

Office christmas party widescreen

It’s Christmas party season again, and it’s time for your accountant to be the party pooper.

Not really – we don’t want to be your party pooper; we just want to make sure you don’t create a tax problem for you and your team.

And if it is a problem, it could be a costly one. However, if you plan carefully, you can stay within the tax exemption rules, and you won’t end up with an FBT headache in the New Year.

Here are the top three things you need to know to help stay within the tax exemption rules.


Keep the cost per person under $300

If the cost of the Christmas party or gift given is less than $300 per person, including GST, then this may be considered a ‘minor benefit’ and exempt from FTB.

Make sure you budget your party properly, and look at the next two points that might help to reduce the cost per head.



Choose your venue wisely

If you host your staff Christmas party on the business premises on a working day, then potentially the cost of food and drink (including alcohol) are exempt from FBT. And there’s no limit on the cost.

It might be time to set up the party at your place and go to town there instead.


Consider the invitation list

By inviting more people, like your team members’ partners, your cost per head could decrease. This could help you get to less than the $300 per head and under the ‘minor benefit’ threshold.

The $300 threshold is appliable to all the guests as well as your team, so it might be good to add a plus one!

Next Step

We hope you find the above information useful.

If you need any help with any of the issues above or regarding tax returns in Gold Coast, we’d be happy to help you. Simply call 07 5649 7650 to talk to one of the team.