Employees

Covid Holiday Parties

How does Covid-19 Impact Your Company Holiday Plans?

December 2020 corporate celebrations will be drastically different than previous years. Would you typically host a party for your staff and their spouses?

These types of events are either going to be:

1. Illegal due to size restrictions, or
2. Not a wise business decision if your entire staff end up in quarantine because of exposure.

I believe that holiday celebrations (in some form) help contribute to the culture of your organization. These events help your staff to feel appreciated and offer an opportunity to create bonds (aka loyalty) to others in the group. If you needed another reason, holiday staff parties are 100% deductible for tax purposes. Canada Revenue Agency permits up to six of these 100% deductible events annually where all staff are invited. Normally, meals and entertainment are only 50% deductible for tax purposes.

If you can’t meet in person in the tradition sense, what are your options? It’s time to get creative. Here are some of my favorite ideas:

Virtual tasting experiences
There is a chocolatier in Edmonton that will deliver their product to you at home and then lead a private online tasting event for small groups. Several local businesses are offering such services for their products.

Skip the Dishes/online gaming
Have dinner delivered to your employees’ home and host a Jackbox party.

Online cooking classes
The ingredients and recipes are delivered to your employees’ home and the culinary instructor leads an interactive online cooking class. This could be a fun “date night” for your employee and their spouse.

Socially distanced experiences
Some hotels/restaurants are getting creative with offering Covid-19 friendly activities. While you still need to follow local Covid-19 protocols, one particular hotel I know of is offering a package that includes a three course meal (a separate table for each couple), dancing lessons (participants keep in their designated square in the ballroom), and a night at the hotel. With travel restrictions still tight, hotels are suffering and would probably be open to suggestions if you came up with a similar idea for a private function. I think that these types of events will become more common with people craving a unique staycation.

The holiday season is fast approaching. With 2020 providing us ample opportunity for re-evaluating our values and priorities, have your corporate holiday plans changed? What are your plans for gifting to your employees?

Here are the rules:

  • Canada Revenue Agency allows you to give your employees gifts costing up to $500 annually without tax consequence to your employee. This could include a birthday gift, a gift for the birth of a child, holiday season, etc. It’s worth noting that small items such as coffee mugs, the clothing with your company logo on it, coffee and tea don’t count toward this $500 total. If your gifting exceeds the $500 limit, the overage is a taxable benefit to your employee. A $700 annual gift would result in a $200 taxable benefit for your employee.
  • Cash and gift certificates are considered to be a form of compensation that results in a taxable benefit to your employee. While our employees may enjoy the freedom of cash stuffed in a Christmas card, they would likely prefer if they didn’t have to pay tax on a gift. With gifting cash, there is the added possibility of a denied deduction as there is zero proof of where the cash went.
  • Event tickets or vouchers qualify as non-taxable benefits as they are redeemable for a specific thing. For example, a voucher that entitles you to a Widget at XYZ Store doesn’t offer much choice to the recipient and therefore qualifies as a gift. Now that we know the parameters, the big challenge is to come up with thoughtful, creative and non-taxable gift ideas. Think about what your employees stress about. What gift can make their lives just a little bit better?

Meal subscriptions
Let’s be honest. Deciding what to have for dinner is the absolute worst part of adulting. Imagine taking a bag of ingredients out of the fridge and simply following the step by step recipe to create a decent meal. THIS is far more relaxing to me than a spa treatment. We’re talking ONGOING stress relieve here!

House cleaning service voucher
This one speaks for itself.

Online cooking class/or tasting experience voucher
Many folks are craving “date night” with their significant other. With Covid-19 restrictions (travel, social outings), many couples are struggling to find opportunities to reconnect. Here is a great Covid-19 protocol compliant date night.

Subscription to a (cool product) of the month club
People like receiving mail that isn’t a bill. It’s a gift that keeps on giving!

Support local
Check out some locally crafted gifts/experiences. Support a small to medium business in your own back yard. The Greater Edmonton Area has some fantastic:

  • Craft Breweries
  • Distilleries
  • Chocolatiers
  • Ciders
  • Cookies
  • Jewelers and crafters
  • Woodworkers
  • Artists
  • Olive oils, sauces, spice blend merchants
  • Soaps and lotions
  • Many many more.

If you’re struggling to come up with a brilliant idea, you could always ask your employees for input. Small to medium business owner operators often know their employees really well. If this is the case, ask them what they’d like. Perhaps you could give them a budget and a catalog/website to peruse. This would take some of the gifting stress off of your shoulders; the employee receives a non-taxable gift that they actually want and you get a deduction for tax purposes. Win, win, and win.

Taxable versus non-taxable benefits can be difficult to sort out. If you have got any questions about how to show your appreciation to your staff, feel free to reach out. We’re always happy to help!