BIM45055 - Specific deductions: entertainment: sponsorship

Sporting or cultural events

The costs of sponsoring sporting, cultural or other events for the purpose of business promotion/publicity are not disallowable under ICTA88/S577. However, it is common for sponsors of such events to be entitled to a certain number of free tickets, private boxes or other benefits as part of the sponsorship package. The cost of sponsorship is not allowable in full if the sponsor receives tickets or other benefits. HMRC normally accepts a disallowance equal to the value of the tickets or other benefits received.

For further information on sponsorship expenditure, see BIM42555 – BIM42565.

In some cases the sponsor may also pay for additional events such as a dinner dance for members of the football club, or a private reception for certain theatre-goers. This will come within the normal definition of entertainment and the cost is disallowed under Section 577.