Holding a business seminar and why you might want to consider it
Why should you think about holding a business seminar? Two reasons, really: the most important is that you can promote your business or an area of your business and invite clients, prospective clients and associates, and two, that you can claim reimbursement of an allowable expense. Surely, having colleagues talking about innovations introduced to your business or inviting a guest speaker to present issues in relation to your business is a very good idea. From this, you might build networks, you could invite the press, and it’s a powerful way to market what your business does.
No doubt, running your own workshops, seminars, or conferences is a great way to create contact time with your clients or customers; it can help you grow your business as much as it can help your clients grow their businesses too. All of this feel-good factor increases the likeliness of attracting, cementing and expanding your business relationships.
This area of entertainment, training, conferences, and seminars is a complex one regards tax and VAT, benefits in kind and tax deductibility. However, providing you have evidence of holding a genuine event, then the expense is allowable for tax purposes. First a bit about entertainment and training allowances:
Generally if non-employees (suppliers, customers etc.) are being "entertained" then the costs are not allowable for tax purposes or for claiming back VAT. If a mixture of employees and non-employees attend, then the costs are apportioned.
Remember, however that while expenditure on entertaining your customers or clients is not an allowable expense, employees and directors of your company have a tax-free allowance of £150 per head over a tax year for annual events such as a Christmas party. Be aware, however, that going over that threshold can cost you dear. Read more here.
The legislation regarding the tax treatment of training says that if a business pays for the training of the proprietor (owner-manager or director), and the training is for a new skill, the costs will generally not be tax deductible. Business-related training for employees will normally be tax deductible for the business. As a director is also an employee of a company, this includes them too.
If the business is VAT registered, the VAT treatment will be determined by whether the training is business or non-business related.
Your company may provide training for individuals not connected to it, however, and although the training itself, such as the cost of speakers or hire of a room, is an allowable expense, any food or overnight accommodation provided for the attendees is a disallowable entertaining expense. Read more here.
Seminars and conferences
Keeping in contact with your client base, talking about your business, services, or something related by holding a seminar, is a prospect worth considering. However, it is as well to be clear about what constitutes a seminar, "a conference or other meeting for discussion or training", and for UK tax purposes, you might add to this definition, "related to your business, which is provided free of charge."Example
Let’s say that DNS’s future-plan involves new technologies and promoting business growth through new technologies. We intend expanding in these areas, which obviously we pass on to our clients through our services.
To highlight our innovation in this area we are going to plan a seminar around staff retention and using new technologies to recruit staff for business growth using new technologies. We get together and plan a four-hour session, refreshments included. We decide on one guest speaker (about psychometric testing), the two other speakers are in-house. The day’s sessions will begin with a motivational talk on business growth and the importance of recruiting and retaining good, loyal staff.
Before you send out invitations, you will be clear about the sort of seminar it is (free and related to your business) and the delegates you wish to invite: in DNS’s case we would invite delegates from among our existing and prospective clients that we know need recruitment back-up. We might also invite human resources specialists from other companies we know recruit staff of our calibre. You send out invitations and you print up all the papers for delegates. The day is planned: 11-15:00. You also send out a press release and reserve a couple of places for the local press.
Expenses relating to business seminars
As for allowable expenses, these might include room hire, lighting and audiovisual equipment, stationery (name badges, printing etc.), and the cost of a speaker. It might also include any reasonable expense for refreshments you provide, but the VAT element of the expense is another sticky area where you need to take care.
Remember that this area of tax law is complex and full of pitfalls; therefore your intention to hold a seminar must be serious and you must be able to prove the content of the seminar and preferably ask attendees to sign in and out, and possibly fill out a quick feedback questionnaire at the end of the session.Conclusion
The seminar is a good way to show current and future customers or clients how innovative and competitive your company is. You can ride PR on the back of it. Without doubt, it is a great way to create contact time with your clients. But be warned, don’t throw a bash and hope that no one will ever want to see evidence that the event was a genuine seminar.
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