EIM32565 - Other expenses: entertainment expenses: introduction

Sections 336 and 356 ITEPA 2003

You cannot decide if an employee or office holder is entitled to a deduction for entertainment expenses solely by reference to the general rule for employees바카라 사이트™ expenses in Section 336 ITEPA 2003 (see generally EIM31620 onwards). You must first of all decide if Section 356 ITEPA 2003 applies to prevent the employee obtaining a deduction. Section 356 is concerned with the expenses of 바카라 사이트˜business entertainment바카라 사이트™ (see EIM32580).

In general, Section 356 prevents any deduction for expenses incurred by an employee or office holder in providing entertainment, or a gift, in connection with the employer바카라 사이트™s trade, business, profession or vocation. But the prohibition does not apply if:

  • the expense has been paid or reimbursed by the employer and
  • the employer바카라 사이트™s payment or reimbursement is included in the employee바카라 사이트™s earnings for tax purposes and
  • the employer바카라 사이트™s payment or reimbursement falls to be disallowed under Section 577 ICTA 1988 or Section 45 ITTOIA 2005 in calculating the employer바카라 사이트™s taxable profits.

The table in EIM32566 sets out the steps to follow in deciding if Section 356 applies. There is also a flowchart at EIM32650a.

The table in EIM32570 shows how the detailed guidance is arranged.

As regards the exemption for goodwill entertainment provided for an employee or office holder by a third party, see EIM21835 onwards.