Businesses are having to cut back on Christmas celebrations due to financial constraints (Image: Getty Images)
According to a recent study, small and medium-sized enterprise (SME) owners and decision-makers are attributing the Labour government’s new budget as the reason for their reduced Christmas celebrations this year.
Despite being considered one of the highlights of the working year, smaller businesses plan to reduce their festive activities by 10%.
Don’t miss…
Over half of SMEs believe that holiday festivities play a crucial role in enhancing team spirit. However, decision-makers indicate they will have to make cutbacks this year.
The average SME plans to allocate just £1,353 for their end-of-year celebrations in 2025, equating to £108 per employee.
Previous festivities have included live bands and Michelin-starred dining, but this year despite being determined to host a successful event 37% are opting for a meal out and 28% are planning drinks only.
However, the budget isn’t the only factor applying pressure; increased supplier costs (41%), lower demand for services (36%), and high taxes (33%) have also prompted businesses to identify areas where they can reduce expenses.
Other factors include rent increases (30%), winter fuel bills (28%), and having more employees to pay for (26%).
A third of businesses will be opting for a simple night out (Image: Getty Images)
But what 53 % of SME’s didn’t know is that they can claim back £150 per head in tax for their festivities. A spokesperson for business account company, , who conducted the survey said: ‘”It’s claimable at the end of your company’s financial year, when you do your accounts and file them with .”
“First step is keeping all your receipts for party expenses, and keeping track of what you are spending per employee to ensure you make the most of this party perk, without over spending – or it becomes taxable.”
“It’s a fun time of year but Christmas parties can be very expensive, and when that’s paired with a tough trading year, it’s no wonder plans are being scaled back,” they added.
“But we hope that Christmas parties are a chance for companies to have some fun – whether it’s a lavish affair or drinks in the office.”
“It’s a real shame that so few businesses know they can claim £150 tax free per employee for seasonal parties – which would at least go some way towards making Christmas planning more achievable.”