Culture Event v Employee Entertainment

[mattieyallaly]

My company is currently trying to better define what constitues an Employee Cultural Event versus Employee Entertainment. Our policy is rather ambiguous and I am seeking other perspectives.

For example:

Deparment hosts a Team Building event….. Culture or Entertainment?  

Several departments gather for a company paid baseball game……. Culture or Entertainment? 

Department throws a baby shower for an employee……. Culture or Entertainment? 

Gift cards are purchased as awards for employees…. Culture or Entertainment?

Your insights are appreciated.

[vfender]

We don't have the expense Type "Culture Event".  We use Employee Event, and this expense type couple be used for the first 2 examples on your list, but definetely not for gift cards or baby showers. 

[Anonymous User]

We use "Employee Team Building Event" for examples 1, 2, and 4. This would be the expense type for Baby Showers but we do not allow baby shower meals/gifts for our employees.  We have a gift/award expense type for your 3rd example.

We do not specify though which is a Culture event vs employee entertainment/welfare expense.

[AmberLee]

Whenever I'm stuck on an expense type question like this I strip it down and go with the basics/requirements/law.

For all but gift cards, they're all taxed the same. Basically any money spent on an employee for whatever reason is 50% allowable. If you throw in just one non-employee (consultant/client/patient etc.) then it's 100% allowable.
*Allowable has different definition when referring to tax

Gift cards are a whole separate issue. Create an expense type just for them and require "attendees". All gift cards are taxed regardless of amount. If you get audited and you're not paying tax on gift cards you'll get docked.