‘Tis the Season, within reason – Revenue’s approach to virtual Christmas parties

Dec 07, 2020

Revenue has confirmed that a BIK will not arise on reasonable costs incurred by an employer in hosting a virtual party for their employees this Christmas. Chartered Accountants Ireland, under the auspicious of the CCAB-I, requested clarification on the tax implications for employers on hosting virtual Christmas parties in light of public health advice which encourages social distancing and limited personal contacts.  

Revenue updated page 6 of the COVID-19 Information and advice for taxpayers and agents on their website to provide the below:

Seasonal Parties

A BIK will not arise where an employer incurs reasonable costs in hosting a virtual seasonal party for their employees. Reasonable costs include costs typically incurred in hosting a face-to-face event. This includes the cost of delivering or providing food and drink to employees in advance of or during the event.

Vouchers provided to enable employees to purchase food or drink for the event are not included. Such vouchers will be taxable unless they are covered by the small benefit exemption.

The event must be open to all employees.