Janet Berry-Johnson, CPA, is a freelance writer with over a decade of experience working on both the tax and audit sides of an accounting firm. You can learn more about her work at jberryjohnson.
The element of surprise and delight is at the heart of being a small business owner. But can it also benefit your tax bill? Tax Advice. Janet Berry-Johnson. Thanks for subscribing to the FreshBooks Blog Newsletter. Expect the first one to arrive in your inbox in the next two weeks. Happy reading!
However, it is important to seek advice from your accountant or qualified tax professional before deciding to purchase client gifts this festive season as not all gifts are tax deductible. This includes sporting or theatre tickets, and gifts of a personal nature.
As an example, Sally has a renovation business and decides to give a bottle of champagne to a client who had a renovation completed in the previous 12 months. She expects the gift will either generate future business from the client or encourage them to refer others to her business.
Although Sally got on well with her client, the gift was not made for personal reasons. Gifts to a married couple. Incidental costs of making a gift.
Gifts to employees. Although employee gifts have their own limitations and may be treated as taxable compensation, an employer is generally allowed to deduct the full cost of gifts made to employees.
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