The exemption does not apply to KIVA subjects.

What should you know about benefits?

If the benefit is the payment for an activity (e.g. a bonus), than it is taxable.

Annex 1 of the Income Tax Act details the cases in which a benefit may be tax-free, including:
- For example, an employer may grant a company car to an employee or business partner for private use.
- A product given to a private customer as a business discount is tax-free: pay one take two In this case, no tax liability arises for either the grantor or the individual.

Representation (§ 3.26. of the Income Tax Act): business events related to the activity of the beneficiary, catering (food, drinks) and services related to the event (travel, accommodation, leisure activities).

However, a family dinner paid for with a company credit card is not a representation.

A team building or sports day organized by the company for its employees also cannot be considered as representation.

A business gift is a gift given in the context of business, official, professional, diplomatic or religious relations in connection with the activity of the donor (free of charge or discounted goods, services provided and vouchers exclusively for this purpose).

A business gift may be given to, among others, an existing or future business partner, but may not be given to an individual (member, contributor) who is employed by or has any other legal relationship with the company.

The business gift can be a voucher if it is non-redeemable, and it is clearly stated which product, service or range of products or services it can be used for.

A product or service is considered a business gift unless it is a security, the tax liability of a business gift is the same as that of a representation, i.e. the payer is liable to pay 15 per cent VAT on 1.18 times the value of the business gift and no social contribution liability arises on a gift transferred until 31 December 2021.

In this context, please note that a gift given to employees as part of an entertainment program does not constitute a business gift, and its value is subject to restrictions.

Contact Colling before you act, they can help!

Prior to organizing any event, or giving any gift or granting a new benefit, ask for advice on accounting options and the content and form of documentation.

Click here to virtually visit Colling