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Entertainment Expenses in New Zealand - Giles & Liew Chartered Accountants

Tax-Deductible Tips for Gifts, Parties and Events

December 19, 2017

Since we know that you always forget what is deductible in relation to presents and parties over the silly season…


If you are giving gifts for clients, business associates or team members that consist of food or drink, you can only claim 50% of the expense as a tax deduction.  If gift baskets or hampers contain some food or drink and some other goodies, the food or drink items are 50% deductible but the other gift items are 100% deductible.

Note that when you claim the tax deduction, you need to apportion the expense between the 100% deductible items and the 50% deductible items.  Let us know the details.


The basics: an expense is business-related if you spend the money to help your business earn income. Business-related expenses are fully deductible. If the expense does not help your business earn gross income, it is a private expense and not claimable as a deduction. Purely promotional events put your brand out there and are a marketing expense for the business. But entertainment events such as Christmas parties inhabit a grey area sometimes.

You will need to make a GST adjustment for any entertainment expenses, which are 50% deductible. This will be required when your income tax return is filed. We can help you with this.

Promotional events

If your promotional event is open to the general public, e.g., sponsoring the local Santa Parade, the event will be 100% deductible as a business expense. However, if the event is not open to the public, but by invitation to customers, business associates, or team members, you can only deduct 50% of the costs.

If you are planning an event for charity, e.g., a Christmas party at the local hospital or serving Christmas dinner at the local homeless shelter, then the entertainment supplied for charity is 100% deductible.

Entertainment outside of NZ

If you are celebrating a spectacular year-end and taking your team to Raro for a weekend, entertainment enjoyed outside New Zealand is 100% deductible. However, if your team contributes to costs (for airfares or anything else), make a note to reduce your expense claim by the amount of the contribution.

About Kylie Liew

Avatar photoKylie is Managing Director and Qualifying Principal of Giles & Liew Chartered Accountants. Her combined experience in Accounting and Business Advisory, together with leadership of business transformation projects and the development of the firm's Digital Transformation services makes her well-placed to help New Zealand businesses grow and succeed in today's ever changing digital business environment. Kylie understands the complexities of business ownership in New Zealand and works with clients to formulate business strategies to help them achieve sustainable growth.

Digital disruption of the Accounting industry presents a unique opportunity to redefine the role of the Business Advisor.  Kylie is committed to exploring innovative ways to achieve growth and create success. She helps clients turn their vision into real value.

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