If you work in an office, chances are that you’ve heard about and received a copy of the office Christmas gifts-giving policy.
There might be a limit to how much you can spend on gifts for your boss, co-workers, and subordinates too. These rules are important to help maintain a good working environment and avoid real, or perceived, favoritism.
But what about if you run your own business? The rules on gift-giving are less clear.
Many business owners don’t give gifts to clients and contractors at all, and those who do may be struggling with what to give and especially, how much to spend.
How much is too much to spend on these people who are an integral part of your business? Here are some things to consider when spending on Christmas gifts for clients and contractors.
How many people are you buying for?
The first thing to do when thinking about buying Christmas gifts for clients and contractors is to figure out how many people you need to buy for. Just like making a gift-giving list for your friends and family, write down everyone you need to buy for that’s had an impact on your business.
Remember, the more people on your list, the less you’ll be able to spend on each of them. If there are some you can trim from the list, you may be able to spend more and get better gifts for those that make the cut.
How much business do you do with them?
When deciding whether or not to get a gift for each client or contractor you do business with, it might help to consider how much business you do with each person or business.
If you have several clients, some of whom you do a considerable amount of business with you and some that you have done very little with, you might want to set a different budget for each of these groups.
For the clients and contracts you rarely work with, a simple Christmas card with handwritten note might be gift enough. On the other hand, you might want to go shopping for the other group. It’s important to make sure they know how much you appreciate their business over the past year.
What do you buy?
What to buy can also be an important part of the equation when you are looking for Christmas gifts for clients and contractors. Of course, you don’t want to give something that might send the wrong message.
One safe bet is giving a food gift. Food gifts are usually a good purchase and can sometimes be shared if there are multiple people in an office where your gift is being delivered. You can either make up a gift basket of goodies yourself, or buy and ship a package with snacks, treats, or even a meat and cheese tray.
Did you know you may be able to deduct some of your gift-giving expenses? According to the IRS, you can deduct “no more than $25 for business gifts you give directly or indirectly to each person during your tax year.”
Keep in mind that there are some exceptions. Therefore, if you are planning on using your Christmas gifts as a tax deduction, you might want to check to make sure you are within the guidelines set down by the IRS before you make your purchases. But don’t let this limit stop you from spending more on a gift for your clients and contractors if you really feel you should. You just won’t be able to deduct the entire amount from your business taxes.
Do you buy Christmas gifts for your clients and contractors? How much do you typically spend?