A works christmas party is traditional at this time of year - but is it allowable as a business expense, or not?
The rule is: if the party is available to all employees, as long as the cost is modest, then the cost of the party is allowable. In this respect, less than £150 per head is deemed as modest.
The £75 per head is not an allowance, and is the maximum allowable for the full cost of the event(including VAT). If the party comes in at more than £150 per head, then the whole cost of the party expenses are chargeable to the Directors and employees that attended.
It is possible to have more than one allowable event in a tax year as long as the total amount spent on events in the tax year is below £150 per employee.