Holiday Expenses Tax-DeductibAre le? What Business Owners Should Know” Staff gifts vs client gifts - Staff gifts (employees) Non-cash gifts (like a turkey, gift basket, or small present) are generally not taxable if given occasionally. Cash or gift cards are treated as taxable income and must go through payroll. Record as staff benefits or wages, depending on the type. Tip: Gift cards = cash in CRA’s eyes. - Client gifts Considered a business promotion expense. Usually 50% deductible, just like meals & entertainment. Must be reasonable and clearly business-related. Tip: Keep receipts and note who the gift was for. - Holiday parties & meals Staff Christmas parties are generally deductible if: They are mainly for employees They’re reasonable in cost CRA allows up to 6 staff events per year at 100% deductibility. Client meals during the holidays are 50% deductible. Tip: Clearly label receipts as staff party or client meal in your books. - Decorations Holiday decorations (tree, lights, office décor) are: 100% deductible Recorded as office or advertising expenses Must be used in the business (office, store, reception area). Tip: Decorations for your home office are deductible only for the business-use portion.