The festive season is almost here – year-end presents for employees
05 Dec 2023
It’s the most wonderful time of the year – the days are getting colder, Saint Nicholas is making his final preparations for 6 December and the first Christmas trees are popping up. So now is the perfect time to remind you that companies can give their employees year-end presents that are exempt from social security contributions and income tax.
Indeed, according to Belgian social security legislation, presents (whether they’re in kind, in cash or in the form of a gift voucher) are not considered as salary if they are given at Saint Nicholas, Christmas or New Year and if their value does not exceed EUR 40 per employee per year. This threshold can be increased by another EUR 40 per year for each dependent child. If these conditions are met, the present will not be subject to social security contributions. If the above thresholds are not observed, however, the entire value of the present – not just the part that exceeds the threshold – will become subject to social security contributions.
The tax treatment of year-end presents is similarly structured and if you’d like to celebrate the holiday season by giving your employees a present, you’ll be pleased to know that – if you keep to the above-mentioned maximum thresholds – you’ll be able to deduct the entire value of the present as a business expense. In addition, your employees will benefit from an exemption from income tax.
If you have any questions regarding the above, don’t hesitate to reach out; we’d love to hear from you.
