Some virtual cheer has been spread by HMRC in their recent clarification that virtual parties for employees are exempt from tax where the cost does not exceed £150 per head.

Their guidance will soon be updated to confirm the exemption, which will follow the existing rules as below;

https://www.gov.uk/expenses-benefits-social-functions-parties/whats-exempt

HMRC's statement, said “Having considered the scope of section 264 ITEPA03 (annual parties exemption), we are pleased to confirm that the exemption will apply to the costs associated with virtual parties in the same way that it would for traditionally held, parties.

"Therefore, the cost of providing food, entertainment, equipment and other expenses which may be incurred in hosting a virtual event, will be exempt, subject to the normal conditions of the exemption being met.

"It is important to note that the intention of the exemption is to allow for costs of provision which are generally incurred for the purposes of the event itself, and that the event, along with any associated provision, is available to employees generally. ”