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HMRC internal manual

Employment Income Manual

Other expenses: entertainment expenses: application of Section 336 to entertaining expenses: extent of examination of claims

Section 336 ITEPA 2003Remember that you need only consider the application of Section 336 ITEPA 2003 to entertainment expenses incurred by an employee or office holder if Section 356 does not prohibit a deduction (see


In deciding whether to make enquiries regarding a deduction for entertainment expenses you should take account of:
* the individual’s status within the employer’s business, and the extent to which his or her duties may be expected to involve the entertainment of business contacts * the amount of any expenses allowance received * whether an expenses allowance is received, and if not, whether an itemised statement is provided for the employer or reimbursement made on a personal note of total spending * the extent to which the relationship between host and guests is likely to have been arm’s length and the activities directly related to the individual’s employment as distinct from the more vague “maintaining of contacts” * the records kept by the employee and the extent to which purely personal expenditure has been eliminated from the claim to a deduction.The points listed are not exhaustive and the decision on whether to take the case up for review has to be taken by reference to all the facts available in each individual case.