In recent years, corporate trips abroad have become very popular. If previously employees usually took a joint vacation in Russia, and went abroad only on business, today everything has changed. Let’s talk about how to organize a corporate event abroad, what you need to know about it, and how tax accounting works in this case.
An obvious advantage of a foreign corporate event is that within Russia it is not always possible to organize a vacation of a certain format and level. Therefore, companies with certain resources are increasingly organizing trips abroad.
Russian companies, especially with the onset of cold weather, are popular not only in warm countries, but also in places where active recreation is developed.
Spain and Italy
The advantage of these states, in addition to the weather, is their history, nature, and developed local crafts. This means that the company can organize a corporate event on a variety of topics: from quests in large cities like Rome or Barcelona, to agritourism with harvesting or visiting vineyards.
Austria and France
These countries attract with the presence of first-class ski resorts, and at the same time, rich history and cultural life. In addition, all major low-cost airlines fly to Europe, which reduces the overall cost of an offsite corporate event.
Countries of the ex-USSR
Armenia, Azerbaijan, Georgia, the Baltic states are very popular among individual tourists from our country. Therefore, corporate events are often held there. The space of the former USSR can give both the impressions of real Europe with cobblestone streets, tiled roofs and mulled wine on the streets, and a real oriental flavor. At the same time, it’s not far to fly to these regions, flight prices are quite reasonable and there are no problems with communication in Russian.
Tax accounting
Corporate travel abroad implies not only new emotions and team building, but also the need to prepare related documents. Since a corporate event, even abroad, is not a business trip, but a measure of stimulation or encouragement for employees without fulfilling an official task, it is formalized differently. Corporate tax accounting abroad is a separate topic, which we will consider below.
Expenses for such a holiday are not recognized by the tax authorities as related to activities for generating income. A small corporate event can be designed as a “representative” event – this will work if you invite business partners and some employees to it, but a trip for the entire company will not work in this category. And in any case, the amount of entertainment expenses cannot exceed 4% of the payroll for the reporting period.
Therefore, corporate expenses are usually covered from the company’s net profit remaining after paying all taxes. Accordingly, a corresponding decision or minutes of the general meeting of shareholders is issued about this. Since in this case the corporate event is held “for an indefinite number of persons” – that is, for all employees of the company – the accountant uses the debit of account 91 (“Other expenses”).
In addition, in order to justify the intended purpose of expenses for the holiday, a corresponding order is issued/an estimate is approved. After this, an act of expenses incurred is drawn up, to which documents confirming them (invoices, etc.) are attached.
