As the festive season approaches, companies may wish to give gifts to their most important customers. These gifts are subject to specific tax rules.
The end of the year can be an opportunity to give a gift to your major customers to thank them for the trust they place in you and to consolidate the professional relationship you have with them. But be careful to stay within the bounds of tax regulations to avoid any risk of tax reassessment.
Recovery of VAT
VAT on gifts is deductible if they are of very low value, i.e. when the unit value of the gift does not exceed 73 EUR (including VAT) per year and per recipient in 2023. The tax authorities include in this value the distribution costs borne by the company.
Deductibility from profits
Gifts to customers are deductible from taxable profits, provided that they are given in the direct interests of your company and that their value is not excessive.
Important: you must be able to prove the usefulness of business gifts for your business (building customer loyalty, for example) and, in particular, be able to identify the recipients by name. It is therefore advisable to keep all the necessary supporting documents (invoices, names of customers, etc.).
Obligation to declare
If the total amount of business gifts exceeds 3.000 EUR over the financial year, you must, in principle, declare them, on pain of a fine. In practice, sole traders fill in a special box in appendix no. 2031 bis to their income tax return. Companies, on the other hand, must attach a detailed statement of overheads (no. 2067) to their income tax return.