# The £150 a head rule for a pub's staff Christmas party: what counts, and a £2,310 night worked per head

> An annual staff party is tax-free at £150 a head or less if all staff can come. A £2,310 night for 14 staff and 4 guests is £128.33 a head.

- Page to cite: https://aeolookup.com/hospitality/staff-christmas-party-pub-150-per-head-annual-function-exemption-2026-worked/
- Publisher: AEO Lookup (https://aeolookup.com/)
- Section: Restaurants, pubs and small hotels, Staff, rotas and tips
- Published 13 October 2026
- Key fact: A staff night costing £2,310 with 14 staff and 4 partners attending is 18 people and £128.33 a head, £21.67 under the line and £390 under a £2,700 ceiling. Counting the 14 staff alone it would be £165 a head, £15 over. A summer barbecue at £45 a head added to a £128.33 Christmas party is £173.33 a head across the year, £23.33 over £150.
- Sources: GOV.UK, "Expenses and benefits: social functions and parties: What's exempt" (a party or similar social function must be open to all employees, be annual, such as a Christmas party or summer barbecue, and cost £150 or less per person; applies to online or virtual parties; separate parties are fine if all employees can attend one; several annual events are exempt if their combined cost is no more than £150 per head; salary sacrifice must be reported). Read 2026-10-13.

A landlord with fourteen staff is booking a Christmas night on a Sunday, with a buffet, a bar tab and a taxi home for the kitchen team. A partner or two will come along. His question is the one every owner asks in October: is this a perk the staff pay tax on, or a night the business can simply fund? The answer turns on a division, and it is easy to get wrong in the other direction by being over-careful.

## The rule on GOV.UK

The page says a party or similar social function is exempt if it:

- is **open to all your employees**;
- is **annual**, such as a Christmas party or summer barbecue; and
- costs **£150 or less per person**.

It also says this applies to online or virtual parties, that separate parties for different teams or sites are fine if all employees can attend one of them, and that **several annual events are exempt if their combined cost is no more than £150 per head**. If staff are in a salary sacrifice arrangement, the value must be reported.

## The night worked

The page I read does not say how to divide the bill, or whether VAT and transport count. I have worked it on the plainest basis, which is our own assumption: the whole bill, including VAT and the taxis, divided by everyone who attends.

| Item | Cost |
|---|---|
| Buffet and bar tab (incl. VAT) | £1,890 |
| Taxis home for the kitchen team | £420 |
| Total | £2,310 |

- 14 staff and 4 partners attending is **18 people**.
- £2,310 ÷ 18 = **£128.33 a head**, which is £21.67 under the line.
- The ceiling for 18 people is £150 × 18 = **£2,700**, so there is £390 of room.

If the partners were left out of the head count, the same bill over 14 staff is **£165 a head**, which is £15 over. That is why the basis of the division matters, and why I would check the divisor on GOV.UK before relying on the lower figure.

## The second event

The line is a total for the year, not an allowance per party. A summer barbecue at £45 a head plus the £128.33 Christmas night is **£173.33 a head**, £23.33 over £150. For a pub that runs two staff events, the cheaper path is to cost both before booking the second.

## Who must be able to come

"Open to all employees" has a plain meaning in a pub: the Sunday-night bar staff, the part-timers and the weekend kitchen porter are all employees. A party held on a night when half the rota is working is still open to all if they can attend, and a separate lunch for the kitchen is fine if everyone can go to one. Keep the invitation list and the attendance with the receipts.

## What I did not read

I did not read what happens to a function over the line, or how VAT, transport and guests are treated, because the page that I read did not set them out. Those are the parts to confirm on GOV.UK or with your accountant before the date is booked.

The rest of the festive month is in the [Christmas trading checklist](https://aeolookup.com/hospitality/christmas-trading-checklist-pub-restaurant/) and the [Christmas and New Year dates for notices and deposits](https://aeolookup.com/hospitality/christmas-new-year-2026-pub-restaurant-bank-holidays-notices-deposits/). If the night leans on tips or a service charge for the team, see [how tips are counted](https://aeolookup.com/hospitality/does-this-count-as-a-tip-who-gets-it-pub-restaurant/).

Overlyft ![](https://aeolookup.com/img/d/ours-badge.png) builds AI staff who join your venue team and keep a running per-head total across the year's staff events from the receipts, so the manager sees the figure before the second booking is paid.

This is general information, not tax advice. Check GOV.UK before you rely on it.

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General information for UK small firms, not legal, tax or financial advice.