When it comes to categorising business expenses, you may find yourself wondering if the expense is meal entertainment or recreation? Or is it even entertainment at all? Rest assured, we have put together a quick reference guide outlining the different business expenses and what category they fall under.
Firstly, let’s just quickly go over the provision of entertainment:
- Entertainment by way of food, drink or recreation
- Accommodation or travel in connection with, or to facilitate the provision of, such entertainment.
Recreation includes amusement, sport and similar leisure-time pursuits and includes recreation and amusement in vehicles, vessels or aircraft (for example, joy flights, sightseeing tours, harbour cruises).
Some examples of the provision of entertainment are:
- Business lunches and drinks, cocktail parties and staff social functions
- Providing entertainment to employees and clients by providing access to sporting or theatrical events, sightseeing tours, holidays and so on
- Accommodation and travel when it is provided in connection with, or to facilitate, activities such as entertaining clients and employees over a weekend at a tourist resort, or providing them with a holiday.
If you have any questions or need help with your business expenses please reach out to us.
*Information provided from www.ato.gov.au