The financial and management platform, Nomo, has launched the practical guide “Christmas campaign: how to fight inflation and get the most out of your business”. The document summarizes the keys for businesses to optimize results at Christmas given the current economic situation and offers tips essential accounting, tax, business strategy or ecommerce.
The impact of inflation on the prices of the shopping basket and on business costs, the rise in interest rates and economic uncertainty may translate into a slowdown in consumption this Christmas. For this reason, the Nomo guide provides essential advice to guarantee good financial and fiscal health in the Christmas campaign and optimize results. For example, analyzing the effect of inflation on the treasury, reviewing unnecessary expenses, anticipating the annual closing or ensuring which Christmas extras are deductible in the usual taxes, are some of the key recommendations.
How are Christmas extras taxed?
Company lunches or dinners, Christmas baskets and other gifts to workers, suppliers and customers are common expenses during the Christmas season. Nomo details the keys for deduct correctly the Christmas extras in the usual taxes.
Business lunches and dinners
- Corporate Tax (IS): Company dinners are deductible in Corporate Tax (IS). It is necessary to demonstrate assiduity, that is, it is necessary to justify to the Treasury that the Christmas dinner or lunch is a tradition or custom of the company through invoices of similar expenses from previous years.
- Value Added Tax (VAT): Company dinners are not deductible in VAT. Only the VAT quotas in hotels and restaurants that are a consequence of displacements or trips and that are also deductible in the IRPF and in the Corporate Tax are deductible.
Christmas baskets or gifts
- Corporate Tax (IS). Christmas gifts are deductible in Corporate Tax. In gifts to workers, as with company dinners, it is necessary to demonstrate diligence through bills of similar expenses from previous years. With gifts to suppliers and customers, it must be shown that they are public relations expenses. In promotional gifts, it must be demonstrated that their purpose is to promote the sale of products or services. Donations and liberalities are not considered deductible expenses.
- Value Added Tax (VAT). Christmas gifts are not deductible in VAT. Yes, they are free samples and advertising objects of little value -less than 200 euros in a year to the same recipient-; or the Christmas lottery to clients or suppliers if it is justified that it is a public relations expense.
