Now that you have all your holiday promotions ready to go, you now have to decide who should receive presents, what these presents should be, and what your spending limits are when buying gifts for all of the people that are really important to your business. There is no limit on the number of people to whom you may give business related presents. In addition, there is no limit on how much you spend on these presents. However, your business gift deduction tops out at $25 per individual receiving a gift, so it would be highly prudent to choose carefully.
Here are a few helpful tips to help you decide which holiday presents would be best for many of the special people who have helped you and your career. You should always make sure that you give from the heart; however, you should always remember that the heartstrings are often pulled by the same forces that tug on one’s purse strings.
Who Gets a Business Present?
The holidays are the perfect time to let your employees know just how much you appreciate all of their hard work and effort. However, you should always bear in mind that this is not a chance to reward them for great sales. Giving presents for the holidays is quite different from the annual bonus that is given at the end of the year.
When it comes to giving holiday presents to clients and other business partners, you should only give holiday gifts to the ones with whom you share an ongoing working relationship. In addition, you should not get a holiday present for anyone that you are presenting a bid to because it could be considered by many to be a type of bribe. You should also make sure that any person that you are buying a gift for is allowed to accept a holiday present because certain organizations and government agencies do not allow this sort of activity.
What Kinds of Presents Do Professional Associates Get?
The specific types of holiday presents that you buy for your staff depend on many different factors, depending on the organizational structure of your company. For instance, your secretary would not get the same type of gift as an accountant or a VP.
Personal gifts are okay as long as they are not too personal and do not show any sort of favoritism for any employee in particular. Personal gifts can also be a great thing to give to your partners and clients, especially if the gift makes an appropriate reference to a particular recreational pastime of a client. Food is also considered to be a popular holiday present for many different kinds of clients and employees. Just be sure to take it easy on the fruitcake. Okay?
How Much Should Be Spent on Business Gifts?
Since $25 is the tax deduction limit, it would be wise to stay close to that amount so that your gift giving may remain cost-effective (especially if you own a small business). However, when giving holiday presents to your biggest clients, you may want to think just a little bit bigger. Here are some rules for you to follow:
- For those bringing you $15K this year, spending $100 to $200 on a sensible holiday present would be seen as a very favorable gesture of goodwill.
- For clients bringing you more than that in a year, $200 to $300 might be more appropriate.
- For clients bringing you $10K or less, spending $35 to $75 is would be considered by most to be an appropriate amount.