The cost of a staff party or other annual party entertainment is generally allowed as a deduction for tax purposes. If you meet the various criteria outlined below then there is no requirement to report anything to HMRC or pay tax and National Insurance. There will also be no taxable benefit charged to employees.
Note, the £150 is an exemption and not an allowance. This means that any costs over £150 per head are taxable on the full cost per head.
It is highly recommended when planning a staff party or other annual event to aim to stay within the parameters outlined above to ensure there is no additional tax cost to the party.