Situation: The director of a company, according to the articles of association, who is also an employee, wants to settle his tourist services in 2023. Given that the non-taxable limit is 33%, it is desired to grant a monthly amount up to the limit .
The total amount of the invoice for tourist services is 15,000 lei.
Can the company pay 33% of the employee’s salary each month on the basis of this invoice until the 33% limit is reached?
Solution: According to the updated Tax Code, Article 76 paragraph (4^1) and (4^2) :
The following monthly accumulated income does not represent taxable income within the meaning of the income tax, within the limit of the monthly limit of not more than 33% of the basic salary corresponding to the job occupied or of the monthly salary/monthly salary granted/ granted according to the law:
(…)
- d) the cost of tourist and/or treatment services, including transport, during the holiday period, for own employees and their family members, granted by the employer, as provided for in the employment contract, internal regulations, or received on the basis of special laws and/or financed from the budget, within the limit of an annual limit , for each employee, representing the level of an average gross salary used to base the state social security budget for the year in which they were granted; (…)
The order in which the incomes referred to in paragraph (4^1) are included in the monthly limit of not more than 33% of the basic salary corresponding to the job occupied or of the monthly salary/monthly wage granted/allocated according to the law is established by the employer.
As regards the settlement of tourist services, they are calculated according to the average gross earnings used to base the state social security budget for 2023.
Thus, according to Law no.369/2022 on the state social insurance budget for 2023, the average gross earnings used to base the state social insurance budget for 2023 is 6,789 lei.
Therefore, the settlement of tourist and/or treatment services, including transport, during the holiday period, for own employees and their family members by the employer can be made up to 6,789 lei in 2023.
Regarding the above case, even if the annual non-taxable amount for tourist services is 6789 lei, in January only 33% of the basic salary of the company’s administrator, as an employee, can be settled, because the legislation does not provide that the unused limit of 6789 lei can be carried over to the following months when the employee is not on leave.
Therefore, if, for example, the employee is on leave in February, he can also benefit from a non-taxable income of 33% of his basic salary in February.
The difference between the non-taxable limit calculated in this way and the amount of 15,000 lei is treated as wage income.
The solution for the employee to benefit from the full non-taxable amount is to go on leave in several months of the year until the limit of 6789 lei is reached.
In conclusion, of the 15,000 that the company pays to the employee, the non-taxable income represents 33% of the basic salary for January 2023, and the rest is treated as salary income.
Legal basis:
-Law 369/2022 State Social Insurance Budget for 2023, with subsequent amendments and additions;
-Fiscal Code (approved by Law no.227/2015, published in MO no.688 of 10.09.2015), as amended and supplemented.