As a business owner, you give business gifts to strengthen your business relationships. Unfortunately, the tax rules surrounding these gifts are a bit more complicated. In this article, we explain the rules for 2025 and give you useful tips to get the most tax benefit from your gifts.
What are corporate gifts?
Business gifts refer to gifts that entrepreneurs give to customers, suppliers or business partners to strengthen business ties. And these can be anything. From a bottle of wine or a luxury pen to personalised promotional items with your company logo on them. The possibilities are endless. And although these gifts are business-related, the tax authorities set strict rules for the deductibility of these expenses.
What are the rules for corporate gifts in 2025?
In 2025, the rules on corporate gifts remain pretty much the same as the year before. They fall under the representation expenses, which means its deductibility is limited. To get a tax advantage, you need to make sure the gift has a clear business character. So it should not simply be a personal gift. There are also limits on VAT deduction and the deductibility of the cost itself.
Deduct VAT on corporate gifts
As a business owner, you can sometimes deduct VAT on business gifts. However, there are some conditions. For example, the gift must go to a business relation who is themselves VAT deductible. Also, you may not exceed the annual threshold.
Thresholds and restrictions
The Inland Revenue applies a threshold of €227 (excluding VAT) per recipient per year. If you spend more than this amount on business gifts for a client or relation in one year, the VAT is no longer deductible. Do you stay below this limit? Then you can still deduct the VAT, but only if the recipient also uses the gift for business purposes.
Overview of threshold values per type of gift
| Type of gift | Deductibility | VAT deductible? |
| Promotional items (pens, mugs) | Fully deductible | Yes, provided business use |
| Luxury gifts (watches, jewellery) | Non-deductible | No |
| Food and drink (not in catering) | 80% deductible | Restricted |
| Gifts above €227 per year | Non-deductible | No |
Which corporate gifts are tax deductible?
Not all business gifts are tax deductible. Gifts that contribute to your business promotion, such as printed items with your logo, often fall under marketing expenses and are therefore fully deductible. Luxury items such as expensive watches or jewellery are usually not deductible. This is because the tax authorities see these as private expenses. And food and drinks are usually deductible for 80%. Unless you consume it in a catering establishment, in which case other rules.
Gift vouchers are also often given as business gifts. But beware: the tax rules for this differ. Want to know how gift vouchers are treated for tax purposes? Then read our article on gift vouchers and tax rules.
How much can you spend on corporate gifts?
As a business owner, you can give out as many corporate gifts as you want. In fact, there is no legal limit. Just be aware of the threshold of €227 per recipient per year if you want to deduct the VAT. And take a moment to think about how your gift comes across. A small, handy gift with your logo can often make more of an impression than an expensive gift that might be a bit over the top.
How do you record corporate gifts in your accounts?
To get the most out of your tax breaks, good records are a must. Pay attention to the following points:
- Who received the gift
- The business reason behind the gift
- The value of the gift
- Whether the recipient is liable for VAT
- The date and billing details
If you keep neat records of this, you will avoid surprises during a tax audit and benefit from deductible expenses.
Conclusion
Business gifts are a useful way to strengthen business ties. Yet the tax authorities have some rules on this. In fact, generally speaking, business gifts are for 80% deductible, as long as they have a business purpose and you stay within the threshold. You can only deduct the VAT if you are under the €227 per recipient per year remains and the gift is actually used for business purposes. By keeping good records of your gifts and following the rules, you will avoid surprises in the event of a tax audit.
