Can my business save tax by sponsoring my son’s Sunday league football team?
It depends on whether this sponsorship can be expected to benefit your trade.
In order for the sponsorship to be tax deductible, it has to be “wholly and exclusively” for the purpose of the trade. This means that if your business could gain extra trade or customers by the sponsorship – for example, if your business is a local shop – then it can be argued that the sponsorship is tax deductible. If, however, the sponsorship won’t lead to extra trade – for example, it is obscure and the people who see the advertising would never have cause to use your business, HMRC may treat the sponsorship costs as not tax deductible. Also, if they think that you rather than your business is benefiting, it may be treated as a taxable Benefit in Kind on you.