As remote and hybrid work arrangements have become more prevalent, corporate retreats have gained momentum in recent years. One of the first decisions to make is whether to host a smaller gathering in your office or plan an off-site retreat.
With thoughtful planning, either approach can be structured to fit a wide range of budgets.
When employees work from home with limited in-person interaction, a retreat can help strengthen collegial relationships and support greater collaboration and productivity.
Your office
Staying on your company’s premises can keep out-of-pocket costs in check. The most obvious is that you will not need to rent meeting rooms. And, assuming employees live in the area, you will not have transportation and lodging expenses. You will also likely spend less on food and beverages. A local restaurant can cater your meals and snacks, and you could buy beverages in bulk.
On the downside, employees tend to view on-site retreats as just another day at the office. This can hamper creative thinking and team building and limit possible activities. Worse, employees may be distracted if they can frequently run back to their desks to check email and voicemail.
Off-site locations
In general, workers are better able to focus on a retreat agenda at an off-site location. They are in a new, “special” environment with no visual cues to trigger workday routines. So, even though you will incur greater costs than if you would stayed in your office, you may get a better return on investment.
The fact is, hotels and other facilities that host company retreats need and want your business! Many things may be negotiable, and you might be able to snag discounts by booking or paying early. Get several quotes and compare prices and services. You will have more leverage if you avoid scheduling your retreat during seasonal peaks when local venues tend to be busy with weddings, trade shows and industry conferences.
Hotels earn their biggest margins on food, beverages and meeting setup fees, so they may be willing to provide complimentary or discounted rooms for guest speakers and out-of-town employees. Also, try to negotiate a flat food-and-beverage price for the entire retreat, rather than a per-person or per-event rate.
Possible tax relief
Here is an additional opportunity to manage costs: certain company retreat expenses may be tax-deductible if they meet IRS standards as “ordinary and necessary” business expenses and are not considered lavish or extravagant. In addition, deductions generally do not extend to expenses attributable to employees’ spouses. As a general rule, business meals are typically only 50% deductible, while entertainment expenses are not deductible. Please contact your Rudler, PSC advisor to discuss which retreat costs may qualify, along with the IRS documentation requirements needed to support any deductions.
RUDLER, PSC CPAs and Business Advisors
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