When Christmas comes approaching, business accounting is often the last thing on people’s minds. However, this is often an astute time of year to make sure that everything is in ship shape. Both now and for the New Year that looms around the corner. Here we have picked out 12 (debatably) festive accounting tips for you to bear in mind throughout December.

On the first day of Christmas my accountant advised to me:

1. A Christmas Perk for Your Employee

Christmas is a time for giving. So if you are particularly happy with your team’s work and want to reward them, why not consider giving them a festive gift? While the likes of cash gifts and vouchers are not tax deductible, HMRC states that seasonal gifts are in fact deductible as long as they meet certain criteria. This includes:

  • Value of under £50
  • Isn’t a direct reward for work performance
  • Isn’t in their contract

That means the likes of a box of chocolates, bottle of sherry or a pair of festive socks are very much within the boundaries of validity.

On the second day of Christmas my accountant advised to me:

2. A Festive Staff Party

What’s the festive season without an opportunity to sink one too many sherries with the team celebrating the year’s achievements? Not only are Christmas parties a great means of boosting morale and team bonding, but they also get a little help from the tax man. When accounting for a Christmas party, note that you can claim a tax deduction on an annual event for up to £150 per head. Note: if you do go over £150, the whole thing is taxed (bah humbug).

On the third day of Christmas my accountant advised to me (we won’t continue this as it is getting tiresome, but will attempt to make all the perks rhyme):

3. Chase that Tardy Payee

As Christmas falls at the end of the year, it’s the ideal period in which to tie up loose ends. Although it may seem a bit Scrooge-ish, if you are contacting debtors with a festive message it may be a good time to give then a gentle nudge for any late payments that are due. We’re not saying that you should put it in the business Christmas card, but it is good housekeeping to make sure that your finances are in order in the run up to what is – for many – one of the busiest periods of the year. Note: in order to avoid any hiccups once the new year arrives, why not turn on reminders on your Xero account (if you haver one)? This helps to ensure that no important deadlines are missed.

4. Know What’s Tax Deductible on Your Spending Spree

We know it can be easy to get whipped up in the Christmas hype both in the office and at home and start spending like your grandmother in the midst of a festive market. However, if you are going to give the company card a good run out throughout December, making sure that you are aware of what is tax deductible on your expenses and making a note on them is of vital importance.

Using the likes of Xero cloud accounting platforms make taking note of these expenses far easier. And if you are unsure about whether something is tax deductible, ask your accountant or check out our blog on what falls under the bracket of small business expenses.

5. Claim Back on a Client Gifty

If you’re feeling particularly generous over Christmas and want to send your clients a gift to keep the relationship sweeter than a freshly baked mince pie, make sure that you are doing so correctly. The gift in question must bear a conspicuous advert, be worth less than £50 in value and cannot be in the form of food, drink, tobacco or vouchers.

Father Christmas counting cash

6. Prep for Post-NYE

While it is incredibly tempting to wind down in the days leading up to Christmas, this can actually be a brilliant time to make sure that your business is in shape for the new year. The extra time gifts you a chance to tackle the – admittedly tedious – jobs that you have been putting off (we’re talking receipt-sorting territory). This helps you get your ducks – or perhaps turkeys – in a row, helping to avoid penalties further down the line. 

However, if receipt-sorting is at the top of your to do list, perhaps consider talking to a Xero accountant and find out how the platform enables you to manage these in real time.

7. Take Note of What Was Said by Rishy (and Co)

Love them or loathe them, what the government says in their budget statements – most recently the autumn edition – will likely have an effect on your business. Therefore it’s important to take note of the changes. For example, the recent autumn statement is said to be beneficial to small businesses for a number of reasons.

8. A Cloud Accounting Platform is Best for Thee

Why not consider treating yourself to an easier means of accounting this Christmas? By moving your accounting to the cloud (if you haven’t already) you will be streamlining the process and relieving many a finance-based headache. Which is the best cloud accounting platform? For us, it has to be Xero. But the decision is all yours. Read our blog if you are wondering what Xero accounting is.

9. Claim When Working Remotely

Make sure that you are claiming what you are entitled to when working from home. From lighting to Wifi, there are a number of things that remote workers can claim back in taxes from the government. That isn’t to say that you can roast your Christmas on the taxman’s buck. Learn what does and doesn’t qualify on the HMRC website.

10. Make the Most of Your Accountant (Me)

Yes, these rhymes are getting desperate now…

We get it, us accountants are often deemed boring or even Scrooge-ish given the nature of our work. But rest assured, we are taking these actions and giving this advice for your benefit. We are here to assist with tax savings, growth plans and everything in between. If you don’t already have an accountant, that leads nicely onto our next tip…

11. Get in Touch with the Raedan Tea(m)

Are you running a creative business but in need of a helping hand with your finances? Get in touch with our team and learn how our team of accountants for creatives can help your business take its next steps toward industry stardom.

12. Relax With A Mince Pie or Three

While focusing on your business finances is important, so too is your own mental health. It’s very easy to get swept up in your company’s wellbeing that you forget about you own. Make sure that you sit back, switch off and spend time with you loved ones. This means that you’ll be heading back into the office fully refreshed and ready to face the New Year.