As a company, you want to give employees small gifts from time to time to express appreciation. But what kind of gifts count as such and are they tax-free? In this article, we explain what is considered attention and which tax regulations must be observed.
Tax regulations for attentions
The most important question is whether occasional gifts are tax-free at all. In principle, benefits in kind up to 60 euros per occasion (e.g. wedding, birth of child, promotion, farewell) per employee are tax-free. These are benefits in kind that are paid in addition to regular wages and may not be paid out in cash or to the account. However, there are also exceptions to this, for example when it is a bonus for a special service or the attention is associated with an anniversary or a company event.
The Regional Hero Card as a tax-free option
One option for companies is to use the Regional Hero Card. With this tax-free payment card, employees can shop at any Mastercard acceptance point and thus decide for themselves what attention they want to receive. Whether it's a T-shirt from your favorite shop around the corner, a concert visit or a meal in a restaurant — the Regional Hero Card offers a wide selection within the respective region. Cash gifts for special personal occasions can also be easily covered with the Regional Hero Card. In this way, companies can give their employees great pleasure without them having to worry about the tax aspects.
Monetary benefits with higher amounts and lump sum taxation
For higher amounts, the attentions must usually be taxed as a monetary advantage. This means that the allowance is considered part of the employee's taxable income and therefore social security contributions are also due. Section 37b EStG states that an employer can also pay income tax for relevant gifts for employees of up to 10,000 euros above the flat tax rate of 30%. There are also social security contributions, possibly the solidarity surcharge and church tax.
Gifts in the form of dinner
A dinner with employees can be considered a gift if it takes place in an appropriate setting and irregularly. It should be noted that it must not be a regular meal allowance. As a rule of thumb, a meal of up to 60 euros per person and occasion is tax-free. However, there are also exceptions here, for example when the meal is related to a company event. If the amount is higher, the monetary advantage must be taxed. For larger amounts, it is advisable to obtain tax advice beforehand in order to avoid possible tax traps.
Summary and Conclusion
In summary, it can be said that giving employees attention is a good way to express appreciation and increase employee motivation. However, it is important to comply with tax regulations and to ensure that these are voluntary benefits. The Regional Hero Card allows easy and flexible management of gifts, so that companies can give their employees great pleasure without having to worry about tax aspects.
Are you not yet using the Regional Hero Card in your company? Get in touch with our team and we'll show you how you can offer our regional benefits card as an attractive corporate benefit!
email: info@regionalhero.com or telephone: +49 30 66 77 12 33
