The True Cost of Visiting the Nativity
14th December 2018
The holiday spirit’s in full swing at RIFT, so we’re dipping into the traditional Christmas stories as only truly festive accountants can. Looking at the Nativity itself, one thing in particular jumps out at us – the story with the 3 wise men (or kings, depending on who you listen to).
How far did they travel?
So, the official account’s a little blurry about where these gentlemen actually came from, but it was definitely somewhere in “the East”. Checking through the most likely candidates on the map, we dropped our collective finger on the Sajûr Valley. That places the wise men’s starting point around 400 miles east of Bethlehem.
They’d most likely have been travelling by camel (nature’s transit van) and making the journey with colleagues and employees. In that light, we’d imagine it’s pretty safe to call this a business trip to a temporary workplace.
At the current Approved Mileage Allowance Payment rates, each person making the trip would be entitled to 45p per mile. Obviously, this is a 2-way journey, so that comes to £360 a head. Definitely enough to be worth claiming back.
What did they spend on food and accomodation?
Of course, we’ve also got food and accommodation to consider - both on the road and while they stopped off in Bethlehem. We already know that hotel vacancies were scarce (setting a Christmas tradition that persists to this day), so we’re probably looking at some hefty bills there.
Hopefully, being wise men, they rememebered to keep their food receipts. Food costs are worth really 12% of an average tax refund claim, and if you're missing evidence of what you spent, you're missing out. Maybe by as much as £500 per year!
Then again, following a star meant they didn’t need to pay for maps and navigators, so it’s swings and roundabouts there.
How much did the presents cost?
Then there’s the whole issue of the world’s first Christmas gifts…
It’s pretty safe to assume that a chest full of frankincense or myrrh won’t be knocking the Nintendo Switch off many kids’ Christmas wishlists this year, but back then they were kind of a big deal. More even than the gold, in fact.
Most people complain about missing out on presents if they have their birthdays on Christmas Day, but baby Jesus could probably have bought the stable, the inn and half of Bethlehem with this little haul.
The thing is, though, the wise men probably got stung quite hard on the deal. Even assuming that they could argue that Jesus was a business client (which is pretty dodgy anyway), business gifts aren’t usually tax deductible.
Even if they managed to call the presents “advertising” for whatever services wise men offer, there’s a cap of £50 on their total value if you want to claim tax relief on them. If the value goes over that, you also generally need to account for VAT on them, which can get messy if you don’t know what you’re doing.
Could they claim any business expenses for their servants?
There’s one more thing worth considering, though. Remember the employees we mentioned earlier? It’s pretty safe to assume that, whether they were wise men or kings, they brought a few attendants along for the ride.
Well, it turns out that Christmas parties can count as a business expense for tax purposes. They’re exempt from National Insurance and tax, but you do have to stick to a few rules to qualify.
- You need to be set up as a Limited Company.
- The party needs to be some kind of annual event and open to all employees.
- Shareholders don’t count unless they’re also employees or Directors.
- You can’t claim for more than £150 per person (including VAT).
So, the Nativity blow-out wouldn’t take all the pain out of the gold, frankincense and myrrh being disqualified as allowable for tax relief, but every little helps, right?
Okay, so we’re messing about a bit here - but there’s a point to it. Christmas is an expensive time of year for everyone. A real wise man is one who knows how to get the most out of his yearly tax refund. That money is yours by law, so there’s no reason to stuff the taxman’s stockings any tighter than necessary.
If you've not made your tax refund claim yet this year, or if you know you've still not got that self-assessment tax return filed then get in touch now! It's always nice to kick off the new year with full pockets.
Merry RIFTmas, one and all!