Whether it is a boat and caravan show, a home and garden show, or a local flower show, if you are involved in these events you will be all too aware that ’tis the season. If you have a stall or an entry in these events, you may want to use this as an opportunity to market your business.
Events such as these see people from far and wide frequenting the show. This is a perfect opportunity to raise your business profile.
One easy, yet tax effective way of marketing your business is to have the employees staffing your stall wear identifiable clothing. Paying for staff clothing would ordinarily be a fringe benefit and subject to fringe benefit tax. However, if the clothing is distinctive work clothing, no fringe benefit arises. The amount you pay for your employees’ distinctive work clothing can be a deductible expense for your business, yet, at the same time not give rise to income for your employees.
Distinctive work clothing includes clothing worn by an employee as, or as part of, a uniform that is worn in the course, or as an result, of employment and that can be identified with the employer:
- through the permanent and prominent display of a name, logo, or other identification that the employer regularly uses in carrying on their activity or undertaking; or
- because the colour scheme, pattern, or style is readily associated with the employer.
It cannot be clothing that an employee would normally wear while not at work. There is an ability to pay an amount for plain clothes in certain circumstances, but generally, if your employee would wear their uniform out on the town on a Friday night, even if they had a chance to change, then it is probably not distinctive work clothing.
There are the common examples such as the red shirts worn by employees of The Warehouse, and the Crowe Horwath printed business shirts. Regardless, they are a great way of raising the profile and visibility of your business.
If you are entering a show or taking a stall at a show, you might want to consider the option of providing employees staffing the stalls with clothing that bears your brand.
For more information, please contact your Crowe Horwath tax adviser.