HMRC have confirmed with Institute of Chartered Accountants in England and Wales (ICEAW) that the annual party exemption applies to employee virtual parties, including any gifts consumed at the staff office party up to a value of £150 per head.
According to the ICAEW, virtual parties will be treated for tax purposes in the same way that it would be for traditionally held parties.
The ICEAW HMRC confirmation (20th November, 2020) stated;
“Having considered the scope of section 264 ITEPA03 (annual parties exemption), we are pleased to confirm that the exemption will apply to the costs associated with virtual parties in the same way that it would for traditionally held, parties.
Therefore, the cost of providing food, entertainment, equipment and other expenses which may be incurred in hosting a virtual event, will be exempt, subject to the normal conditions of the exemption being met.
It is important to note that the intention of the exemption is to allow for costs of provision which are generally incurred for the purposes of the event itself, and that the event, along with any associated provision, is available to employees generally.”
If you are uncertain about what the 264 ITEPA03 (annual parties exemption) and how it might apply, the ICEAW have a great overview and explanation here.