Part 2

Trading income
Chapter 4

Trade profits: rules restricting deductions

Business entertainment and gifts

Business entertainment: exceptions
46
1
The prohibition in section 45 on deducting expenses incurred in providing entertainment does not apply in either of cases A and B.
2
Case A is where—
a
the entertainment is of a kind which it is the trader's trade to provide, and
b
the entertainment is provided in the ordinary course of the trade either for payment or free of charge in order to advertise to the public generally.
3
Case B is where the entertainment is provided for employees of the trader unless—
a
the entertainment is also provided for others, and
b
the provision of the entertainment for the employees is incidental to its provision for the others.