SMALL business operators have been urged to ensure their tax affairs are in order to enable them to enjoy a relaxed Christmas break.

Dave Forrester, who runs TaxAssist Accountants in Keighley, said traders such as independent retailers, restaurants and service providers, should act to avoid potentially expensive ‘Yuletide traps’ at their busiest time of the year.

He said: We’re urging local business owners to add one more column to their to do list this Christmas. We want them to make sure they play by the taxman’s rules and avoid potentially hefty penalties.”

His Christmas top tips include abiding by the rules covering temporary seasonal staff by not paying cash in hand without deducting income tax and National Insurance contributions.

Remembering that if the total costs for all of annual events, such as staff parties, exceeds £150 a head, it becomes a benefit in kind for employees and cash or gift vouchers of any amount are taxable and should go through the payroll. Significant gifts need to be reported on form P11D and require payment of Class 1A National Insurance.

Using the Christmas break to complete tax returns. Last year 17,000 people filed their tax returns on Christmas Eve and a further 1,566 on Christmas Day.