As we are now approaching the end of the 2023 calendar year, you might be thinking about rewarding some of your key contacts outside your business who helped you during the year.

To maximize your tax deductions, you need to identify what is an “Entertainment” gift and what is a “Non-Entertainment” gift.

You want the gift to be “Non-Entertainment” as it’s a normal tax deduction, and you can claim the GST credits, just like any normal business expense.

However, “Entertainment” gifts are not tax-deductible, and you have no entitlement to a GST credit.

Some examples of “Entertainment” gifts are: Theatre tickets, movie tickets, sporting event tickets, hired entertainers, flights, and holiday accommodation, etc.

Some examples of “Non-Entertainment” gifts are: Flowers, electrical goods; e.g., TV, bottled spirits and beer, Christmas hampers, gift vouchers, etc.

To maximize your tax deductions, try to find “Non-Entertainment” gifts for your key contacts. If you are unsure about a particular item, please feel free to send a message.