This infographic provides a clear overview of the VAT rules concerning entertainment expenses in the UK, effective from 2025. It delineates between different categories such as subsistence (meals and accommodation during business travel), staff-only events (like team-building activities), and client entertainment (hospitality provided to clients or suppliers). The visual guide emphasizes key points:
Subsistence: VAT on meals and accommodation during business travel is generally reclaimable, provided the expenses are necessary for business purposes.
Staff-Only Events: Full VAT recovery is allowed for events exclusively for employees, excluding directors or partners, if the primary purpose is business-related, such as boosting morale.
Client Entertainment: VAT on hospitality provided to clients or non-employees is typically non-recoverable, as it’s considered a private benefit. However, exceptions exist for overseas clients with strict business purposes.
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