Client entertainment
Entertaining clients or customers is generally not allowable for tax, even though it may be a normal part of doing business.
Sole traderNot allowable
Ltd companyNot allowable
EmployeeNot allowable
Conditions
- Business entertaining of clients, customers or suppliers is specifically disallowed for tax purposes.
- This applies whether you trade as a sole trader or through a company.
- Staff entertaining is treated separately and may qualify for limited relief.
Common mistakes
- Assuming a client lunch is allowable because it was clearly for business.
- Confusing disallowed client entertaining with staff entertaining, which has its own rules.
What to keep
- Even though disallowed for tax, keep records to separate entertaining from other costs in the accounts.
Real-world example
A company takes a prospective client to dinner to discuss a contract. The cost can be paid by the business but is added back and not allowed as a tax deduction.
Frequently asked
Is staff entertaining treated the same as client entertaining?
No. Annual staff functions can qualify for a limited exemption, while client entertaining is generally disallowed. Check the current staff-function limit on GOV.UK.
Not sure how this applies to you?
The rules shift with your circumstances. A qualified accountant can confirm what you can claim and handle it for you.
Find an accountantRelated allowances
Source: HMRC guidance · Last checked 2026-03-01
This page is general information based on HMRC published guidance, not tax advice. Status shown is a plain-English summary — your own position can differ. Always check the HMRC source above and speak to a qualified accountant before making a claim.