Q: Can I offer a beer and wine box to our employees? Is this taxable and tax deductible?
A: You have got into the "Red Devils mania" and want to send to all your employees beer and wine to support the Red Devils through the second match on Thursday. Of course, you may do so but you should also consider the tax and social security consequences of such an initiative.
The general rule is that any benefit obtained in the framework of the professional activity constitutes taxable income. An exception to this principle is the award of so-called "social benefits".
This is a benefit of small value or a customary gift awarded due to a special event not directly related to the professional activity.
The qualification as “small value gift” is a matter of facts. In practice, the tax authorities accept a value of 50 EUR. A box of beer and wine of 40 EUR can therefore be awarded as a social benefit. You do not have to withhold any payroll taxes nor to mention the benefit on a payslip or tax form.
However, you should bear in mind that, in principle, a social benefit is not tax deductible as a professional expense for the employer. If you deduct it, it may be rejected.
The tax treatment would be different if you offer a box of beer and wine of more than 50 EUR. In that case, you should contact the tax authorities beforehand to ensure that the benefit is of sufficiently low value.
For social security purposes, offering a beer and wine box, in the above-mentioned circumstances, is considered as a 'gift' and is therefore exempted from social security contributions.
Please do not hesitate to contact someone from the Employment & Benefits team, we are more than happy to advise you with the implementation of your social benefits.
