The Christmas party pays off: It strengthens the working climate

In January the Frankfurt trade fair already shows trends for the next Advent season, at the “Christmasworld”. And in July at the latest, locations should be booked for corporate Christmas parties: Christmas is already coming up, when the decorations have just been stowed away. Those who plan the event early, generate the greatest benefit for their company … And make it easy on the nerves.



Christmas party: When for once it’s not about competency

Almost no other season is as emotional as Advent. Christmas is the big finale. And it shows who has the nerves and the intuition. After all, what is a Christmas party about? Is there a norm that must be fulfilled? Or is it the perfect opportunity to address truly relevant topics in the company in an elegant way? Experience shows: Those who give the Christmas party an individual reason, lay the foundation for success in the following year.

The magazine Event Partner spoke with Prof. Dr. Karlheinz Ruckriegel, happiness researcher, in an interview about: How corporate Christmas parties contribute to happiness. Quote: “Well-made and well-organised Christmas parties show i.a. that the entrepreneur cares for his employees. Such celebrations can be a true ‘Christmas present’ to the staff. But as is common when it comes to presents: They become all the more valuable for the presentee, the more thought and effort the gift-giver invests when choosing the present. That is why entrepreneurs should place a lot of value on the preparation.” Source:

Dr. Ruckriegel summarised that perfectly. His recommendation that the Christmas party should have a message that every guest understands, internalises and takes home, is 100% correct. The “art” lies in the consultation by the event agency that has experience with Christmas parties. The briefing with the entrepreneur or head of department reveals clear messages. These are realised creatively and picked up by the staff.

The boss is only human …

Online you can find many tips in respect to how employees should conduct themselves at a Christmas party. But what about the boss? Emotional situations like Christmas parties can be a real challenge for managers. Stefan Biggeleben of Business Softskills knows the problem. He coaches people in all business matters – from the applicant to the entrepreneur. A few tips from the coach:

Should the boss give a speech?

Definitely, yes! He has the opportunity to address the whole staff personally. A pleasant speech can influence the corporate climate positively for a very long time!
A few recommendations:

  • Please keep the classical section on “facts and figures” as brief as possible. However positive the results may be – boredom is just around the corner.
  • Refrain from comparisons between individual departments and company areas. What is intended as “incentive” quickly becomes the mood killer of the evening.
  • One or two personal experiences from the last year can smooth the way. Was there any praise from business partners? Did a business partner almost have a little glitch? Make it funny! It shows that you are human – as is the rest of the attendees.
  • Are you proud of your people? Then express that sentiment clearly! After all, appreciation is one of our basic needs.
  • Bad results? Lay-offs? Even uncomfortable experiences from the past year are ever-present and want to be addressed. Express your (authentic!) sympathy before you share your positive expectations and endeavours for the next year with your staff.

Stage fright? This can help

Welcome the exciting feeling of stage fright in yourself with open arms! It shows that you care about the “audience”, i.e. your employees!

  • A good preparation can help. Re-read your prepared text – hopefully written from the heart – several times. Better yet: rehearse your speech several times! In front of whom? Well, spouses and significant others, children or assistants can be honest mirrors.
  • It often helps speakers to perform some loosening-up exercises right before their appearance (shoulders, legs, face, mouth) and breathe deeply.
  • Still shaky? Do your legs turn to jelly? Okay, so what? It’s a natural thing and can be quite endearing, if you address it openly.
    “My God! In often extremely important business negotiations with the toughest businesspeople I am not nearly as nervous as I am now. And here, I stand before dear colleagues. As I am just finding out, it might be because this evening is so important to me.”
    I heard these words at a Christmas party in Berlin, where I held a short lecture after the speech. The result – you may already have a feeling: The experienced, yet in this moment truly nervous managing director got raging applause in this moment and his successive 15-minute speech was a huge success.

 With whom does the boss or the manager sit down?

A new (and welcomed) custom: At least one manager per table, if possible. That is definitely better than a separate “VIP table”.
But wherever you – dear managers – will be seated. Please remember how much appreciation all employees feel whose table you visit in the course of the evening! Enjoy your meal without hurry and chat with the people at your table before you start your round tour. The people at your table will surely understand.

Conclusion: Those who let pros plan their celebration are free to focus completely on their employees.

The message determines the location

The same old pub or maybe even the in-house cafeteria? If you want to motivate your team, be sure to avoid stagnancy. A feeling of trust is not necessarily linked to a familiar location. Comfort, cosiness, safety: All that is created by a unity of word and deed as well as location. But: If the celebration was a huge success, the location can be booked in the next year as well. However, in that case the details should change.

In every company there are uncomfortable discussions and situations. To make a cut and start fresh somewhere else – even for just a few hours – can be a good thing. The positive impressions will accompany the team to work the next day – in their hearts. Yes, it can be that sentimental … And that is a good thing, too.

An event agency with a good network has numerous different locations for events at their disposal. The size of the group, the budget and the intention of the Christmas party build the framework for a certain location. Attention: In the second half of the year it can be much more difficult to get suitable locations. The organisation of the Christmas party should already be part of the annual plan. In that way, surprises will be limited to the secret Santa agenda item.

Feeds the soul: catering and show

The parameters that apply to the location apply here as well:  Alternation has a positive effect. In times of culinary sensibility – keyword: allergies – and cultural differences it is possible to dive into corresponding worlds of flavour. Asian, Mediterranean or regional? The dishes align with the motto of the Christmas party. What you should consider:

  • Generate sustainability through seasonal and regional products.
  • Plan reasonably sized portions.
  • Consider intolerances.
  • Respect religious backgrounds.
  • Provide perfect service.
  • Use re-usable or compostable tableware.

A little entertainment during desert? Why not? What potentially endangers a successful Christmas party is the formation of groups. True, everybody wants to experience something great, new and exciting. But only a few find the courage to change their conversation partners. The show, a master of ceremonies or walking acts can steer the mood.

What the tax accountant has to say about Christmas parties

“There is an unwelcome guest at every Christmas party”, says tax accountant Ulrich Kur. He is referring to the IRO. He elaborates: “The strict German tax regulations on corporate events apply here.” That means: If the costs of the Christmas party per employee are higher than 110 EUR, there can be unfavourable consequences in respect to wage tax and VAT. In the following you can read what needs to be considered in respect to Christmas parties and taxes.

If the costs per employee for the Christmas party 2018 are too high, the employer needs to pay tax on wages and the input tax deduction may be lost. That is the case, if the per capita costs of the participating employees are higher than 110 EUR. By the way, this maximum limit of 110 EUR is a gross value.

Depending on whether the employer is assessing the wage tax or the input tax reduction, the following principles apply:

  • Wage tax: When it comes to wage tax, the maximum limit of 110 EUR is a tax-exempt amount. That means: If the costs per employee are 130 EUR, the employer has to pay wage tax for the exceeding 20 EUR to the IRO.
  • VAT: In respect to the VAT the maximum limit of 110 EUR is a tax allowance. If the costs per participant exceed the maximum limit of 110 EUR, the input tax deduction for all the expenditures for this participant will be void.

All figures refer to the year 2018.

Consequences in case the 110 EUR limit is exceeded

In order to calculate the costs per participant, the overall costs are divided by the number of participating guests (not the number of invited guests). If the employees are allowed to bring an accompanying person to the Christmas party, the costs for the accompanying person will be allocated to them.

Example: The costs per participant of the Christmas party amount to 80 EUR. Of the 20 invited employees, 18 bring an accompanying person. Consequence: Since the attendance costs for these 18 employees amount to 160 EUR, 50 EUR will be categorised as wage and require wage tax to be paid. The input tax deduction from the expenditures for these 18 employees is eliminated completely.

Calculation of the 110 EUR limit

In order to be on the safe side in respect to taxes and prevent the elimination of the tax deduction and the requirement to pay wage tax, business owners should calculate the party correspondingly so that the costs per participant don’t exceed the 110 EUR limit, even if the positive court rulings of the German federal fiscal court are not applied.

Example: You book a medieval banquet for the Christmas party. The rent for the location is 1,000 EUR, food and beverages 3,000 EUR, and a minstrel 500 EUR. 80 guests have been invited to the event. 25 employees bring an accompanying person.

The IRO will calculate as follows: Currently, the IRO calculates with overall costs of 4,500 EUR and per capita costs per participant of 56 EUR (4,500 EUR / 80 participants). It allocates the costs for the accompanying person to the employee. That results in per capita costs of 112 EUR for these 25 employees with accompaniment. For the costs for these employees, wage tax has to be paid and the input tax deduction is lost.

And finally: “6 myths about Christmas parties”

“We can’t afford such a Christmas party from the pro.”

That’s not correct. Even small companies benefit from the support of an event agency. Those who organise the party themselves, should write down how much time the boss or assistant spends on it. Time that should have been spent on the main business. And afterwards there is the task of determining whether the party went smoothly or not. Professional event agencies take on smaller projects as well.

“As boss I am obligated to say something at the Christmas party.”

No. The boss doesn’t have to give a speech, if he or she doesn’t feel comfortable with it. Trusted employees can speak as a team. Or you can record a video in advance that will be introduced correspondingly. If the boss is insecure, a coaching might help. The acquired skills can also be useful in other situations like presentations. 

“There has to be expensive food with lots of meat.”

Definitely not. The dishes should correspond with the motto and the guests of the event. If the food matches the atmosphere, it will be perceived as good.

“My employees expect the same party every year.”

This is a common misconception. The team wants to feel safe – especially if it has been a turbulent year. Repeating the same Christmas programme every year can’t mask the difficulties and is boring at best. Maybe you could establish a fixed item on the agenda that will take place every year. A song that is sung together. Or secret Santa. Everything else can change. You have to consider that new employees have no notion of in-company traditions. They would feel slightly left out. And if we are honest: Doesn’t this statement reflect more on the rigidity of the decider?   

“Each year, I have to find a new theme and location – my employees expect that.”

You don’t “have” to do anything. Of course, a restaurant or an activity that everybody enjoyed can be booked again. But such an evening offers many possibilities for variation. It begins with the decoration and ends with the personal present.

“I can’t motivate employees that don’t celebrate Christmas or drink alcohol to come to the Christmas party.”

That depends on the standpoint of the management. If you want to reach out to employees with a different cultural background, you can organise a winter party with corresponding dishes and drinks. If you want to celebrate traditionally, you have to expect that employees of different faith might not come. The professional event agency is a good go-to guy when it comes to such questions. They will work out solutions that do justice to both approaches or present you with a reasonable combination. 


In this blog, Ulrich Kämmerling, proprietor of EVENTAGENTUR artimage e.K., shares his long-time experience in the event business and recommends: “If music is played at the corporate Christmas party, then fees for the GEMA have to be paid.“ Be it live or playlist – the fees have to be paid.