What can you claim under the Entertainment Tax Rules, and it is 50% deductible or 100% deductible?

Confused? You’re not alone

There’s lots of small print when it comes to deducting entertainment expenses which can sometimes make it difficult to determine whether something is 50% or 100% deductible.

First you must determine if the expense is business or private. If the expense is incurred as part of your efforts to make your business to earn income, then it is a business expense. If not, it’s private and therefore not deductible.

• Entertainment tax expenditure is only 50% deductible when it falls under the following categories:
• Corporate boxes
• Holiday accommodation
• Pleasure craft
• Food and beverages – however there are specific occasions when food and beverage are 100% deductible for example, light refreshments, like morning and afternoon teas provided at work. Christmas parties onsite and offsite are only 50% deductible.

As qualified accountants, we can advise on specific circumstances and help you determine the correct treatment of your entertainment expenses. You can contact us or visit the IRD website for further information.