Tax Compliance
Disclaimer: This is for informative purposes only and should not be construed as professional, financial, or legal advice. The information does not constitute or form part of, and should not be construed as, a direct indication from the designated countries’ tax authorities. For updated information, please visit the official tax website of your country’s government/tax authority.
USA
What is the amount exempted from tax in the name of small benefits for employees?
In the United States, every person is allowed a tax-free benefit of up to $25 per year. This is valid for every employee irrespective of the federal, local, or state laws.
How is the taxation done if the small benefit exemption limit is crossed?
A Federal Income Tax (22%) + Social Security (7.65%) + Local/State Tax (if applicable) is applied on the amount above $25.
How does the small benefit exemption work in the USA?
The employer can either record a high value of benefits and withhold the tax, or trim it from the amount being given to the employee.
Where can I contact the tax authorities of the USA?
The Internal Revenue Service USA
UK
What is the amount exempted from tax in the name of small benefits for employees?
In the United Kingdom, an amount of £50 goes tax-free in the name of small benefits for every person through the year.
How is the taxation done if the small benefit exemption limit is crossed?
If the amount goes over the exemption limit or is issued as a voucher exchangeable for cash, it will be taxed on the employee's end under "Other Earnings".
How does the small benefit exemption work in the UK?
There are certain exemptions, the list of which can be checked out here (https://www.gov.uk/hmrc-internal-manuals/national-insurance-manual/nim02416). Trivial benefits are non-taxable, provided that:
it costs the employer £50 or less to provide
it isn’t cash or a cash voucher
it isn’t a reward for employees’ work or performance
it isn’t in terms of their contract
Where can I contact the tax authorities of the UK?
https://www.gov.uk/expenses-and-benefits-trivial-benefits
Ireland
What is the amount exempted from tax in the name of small benefits for employees?
The Irish tax authorities exempt a handsome total of €500 per person through the year in the name of small benefits.
How is the taxation done if the small benefit exemption limit is crossed?
If the SBE limits are crossed, the taxation would be according to the rules and regulations of the Irish tax authority.
How does the small benefit exemption work in Ireland?
The amount is only deemed to be tax-free in case it is gifted in terms of vouchers and benefits. Long Service Awards are not taxable at all as much as €50 per every year of service.
Where can I contact the tax authorities of Ireland?
The Revenue Commissioners, Ireland>> https://www.revenue.ie/en/employing-people/benefit-in-kind-for-employers/other-benefits/service-and-performance-schemes-and-awards.aspx
India
What is the amount exempted from tax in the name of small benefits for employees?
Gifts up to Rs. 5,000 in the aggregate per financial year would be tax exempt in the hands of the employees.
How is the taxation done if the small benefit exemption limit is crossed?
The excess value of gifts over and above Rs. 5000/- would be taxed as a perquisite in the hands of the employees.
How does the small benefit exemption work in India?
The Gift value is added to the CTC (Cost to the Company) of the employee for calculation of Income-tax.
Where can I contact the tax authorities of India?
Income Tax
Poland
What is the amount exempted from tax in the name of small benefits for employees?
In Poland, any purchase of gifts that ZFŚS aka the National Revenue Administration of Poland finances is tax-free.
How is the taxation done if the small benefit exemption limit is crossed?
The amount would be wholesomely taxed. Purchase gifts partly from the ZFŚS and partly from current assets won’t make it tax-free—no matter how much the amount is.
How does the small benefit exemption work in Poland?
This fund houses a separate bank account for every worker and has an employee’s and employer’s contribution to it. The ZFŚS is allocated to leisure, healthcare, entertainment, sports, recreation along with other expenses. Any purchase of gifts that ZFŚS finance is tax-free.
Where can I contact the tax authorities of Poland?
GOV.PL>>https://www.gov.pl/web/national-revenue-administration/about-us
France
What is the amount exempted from tax in the name of small benefits for employees?
In France, an exemption of €169 is given for every person through the year, provided that it's spent on activities other than food and fuel.
How is the taxation done if the small benefit exemption limit is crossed?
Provided that the amount goes about the SBE limit, it shall be fully taxed under the French Tax statutes.
How does the small benefit exemption work in France?
When the gifts are given for an event that marks a significant milestone, e.g. wedding, birth, retirement, Mother’s Day, or Father’s Day, etc. If the gift voucher given for the event (s)mentioned above, one can not redeem it for food or fuel (the voucher’s value should still be €169 per event and calendar year). Cultural events that promote the country’s colors and traditions are also exempted.
Where can I contact the tax authorities of France?
The Ministry of Economy & Finance>> https://www.impots.gouv.fr/portail/
Netherlands
What is the amount exempted from tax in the name of small benefits for employees?
With an amount of €2207 for every employee through the year, the Dutch authorities have a generic gift tax statute for all its citizens.
How is the taxation done if the small benefit exemption limit is crossed?
The Dutch tax authority identifies tax slabs on gifts according to the value of donations. For donations ranging between €0 to €126,723, the tax rate is 30% on the gift value. Meanwhile, for donations with a value that goes above €126.723, the tax rate is 40% on the gift value.
How does the small benefit exemption work in the Netherlands?
In a general sense, there’s no separate clause for the Dutch corporations signifying the gift tax rules for employees, so we are going to focus on what it says altogether.
Where can I contact the tax authorities of the Netherlands?
The Dutch Tax Authority>> https://www.belastingdienst.nl/wps/wcm/connect/en/individuals/individuals
Norway
What is the amount exempted from tax in the name of small benefits for employees?
NOK1000 - that is the maximum an employee can get per year while being exempted from any kind of taxation under the small benefits exemption.
How is the taxation done if the small benefit exemption limit is crossed?
All gifts to employees over this amount and without special occasions and taxable.
How does the small benefit exemption work in Norway?
"All gifts to employees over this amount and without special occasions and taxable. In the case of long service rewards,gifts up to NOK8,000 in value can be given for long service in the business.The first reward for long service opens up after 20 years of service, and after that in every 10 years. Gifts up to NOK4,000 can be given in case when the recipient gets married, reaches the age of fifty (and ten years thereafter), and when the recipient retires. The same amount of reward unlocks when the business reaches a jubilee landmark, i.e. 25 years, 50 years, and soon. It’s a condition that to get tax exemptions, the gifts must be non-cash. Gift vouchers are acceptable."
Where can I contact the tax authorities of Norway?
The Ministry of Economy & Finance>> https://www.impots.gouv.fr/portail/
Spain
What is the amount exempted from tax in the name of small benefits for employees?
Spanish Tax Authorities give a relaxation of up to €299 for every gift through the year per employee.
How does the small benefit exemption work in Spain?
There are certain benefits besides it, like meal vouchers worth up to €11 per day, nursery vouchers, public transport vouchers within certain limits, medical insurance premiums up to a maximum annual amount of EUR500 per family member covered, etc. that are exempted from tax.
Where can I contact the tax authorities of Spain?
Agencia Tributaria>> https://www.agenciatributaria.es/AEAT.internet/en_gb/Inicio.shtml
Germany
What is the amount exempted from tax in the name of small benefits for employees?
The EStG states a total of $44 for every emplpoyee per month that can go tax free.
How is the taxation done if the small benefit exemption limit is crossed?
All gifts to employees over this amount and without special occasions and taxable.
How does the small benefit exemption work in Germany?
"As per Section 8 (para two; clause 11) of the German Income Tax Act (EStG), tax and social security contributions are exempted up to €44-a-month. Section 19.6 (para one) of the German Income Tax Law (LStR) exempt from tax and social security contributions up to€60 for special personal occasions."
Where can I contact the tax authorities of Germany?
BZSt>> https://www.bzst.de/EN/Home/home_node.html
Denmark
What is the amount exempted from tax in the name of small benefits for employees?
With an amount of DKK1100 for every employee for a year, the Danish tax authorities has a threshold for gift vouchers and other non-cash gifts.
How is the taxation done if the small benefit exemption limit is crossed?
The gifts going beyond this limit are taxable to the given slabs.
How does the small benefit exemption work in Denmark?
Skattestyrelsen, the Danish tax authority signifies that gift vouchers and other non-cash gifts aren’t taxable up to DKK1,100 in case they are unrelated to the employees’ jobs. Benefits related to employees’ jobs have a more relaxed threshold, and they are tax-exempt until their value exceeds DKK5,600.
Where can I contact the tax authorities of Denmark?
SKAT.DK>> https://skat.dk/skat.aspx?oid=2244343
Singapore
What is the amount exempted from tax in the name of small benefits for employees?
No corporate gift tax is charged on presents worth under the value of SGD200.
How is the taxation done if the small benefit exemption limit is crossed?
As for the values exceeding SGD200, it would only be taxed in case of a single gift value surpassing the limit. However, multiple gifts can given under the value of SGD200 without being taxed.
How does the small benefit exemption work in Singapore?
If the nature of benefit or gift is that of bereavement, i.e. on the occasion of loss, then it’s exempted from any tax. Such gifts are never taxable, even if their value exceeds S$200. Do note that the above rules apply to cash and non-cash gifts.
Where can I contact the tax authorities of Singapore?
https://www.iras.gov.sg/IRASHome/Businesses/Employers/Tax-Treatment-of-Employee-Remuneration/Gifts/
Malaysia
What is the amount exempted from tax in the name of small benefits for employees?
Normally, gift vouchers are not taxable in the hands of the employee unless they are of a recurring nature and are provided in the circumstances where the employee expects such gifts as part of his remuneration.
How is the taxation done if the small benefit exemption limit is crossed?
In case the Gift Vouchers are part of the remuneration, it will be taxed at the hand of the employee.
How does the small benefit exemption work in Malaysia?
The small benefit exemptions aren't applicable, however, on long service or festivities. The value of gift vouchers would be taxed on the recipient's gross income.
Where can I contact the tax authorities of Malaysia?
http://www.hasil.gov.my/index.php?bt_lgv=2
Philippines
What is the amount exempted from tax in the name of small benefits for employees?
Any gifts below P5000 are exempted from taxation.
How is the taxation done if the small benefit exemption limit is crossed?
These gifts, however, are advisable to be crossed only on special occasions and festivities. Any gift above P5000 would be considered as a fringe benefit and will be taxed.
Where can I contact the tax authorities of Philippines?
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