What is the fringe benefit?

The fringe benefit is a form of compensation that is due to certain categories of employees, which is provided in addition to the monthly salary.

In practice, the company provides the compensation in the form of recognition of goods and services to its employees.

Therefore, when talking about fringe benefits, we refer to a compensation that is awarded only to some employees based on their role within a company.

The main advantage of fringe benefits is that they are not subject to taxes and contributions since it is merely an additional form of remuneration to the cash salary already agreed upon in the paycheck.

Examples of fringe benefits

The benefits most commonly found include: cars, smartphones, tablets, and PC.

The most widely used, however, are the tickets for meal vouchers.

Over the years, fringe benefits have evolved allowing employees to be compensated also with alternatives to income. Indeed, we can consider as fringe benefits those kinds of goods and services that are entirely dedicated to the employee, namely:

• Healthcare assistance;
• Insurance policies;
• Subsidized loans;
• Purchase of company shares;
• Housing provided for the employee and their family.

How fringe benefits are assigned

As for the benefits, especially for the car, the fringe benefit can be used by the employees entitled to it in three ways:

• The use of it for the interest of the company;
• The use of it in the interest of both the company and the employee;
• The use of it exclusively for the interest of the employee.

For meal voucher benefits, they are at the expense of the company and the amount of the voucher can vary depending on the employee.

If the expense is not borne by the company, the benefit is not mandatory but can be provided through an agreement between the employee and companies, also requesting a contribution from the collaborator.

The contribution required from the employee can vary depending on the good or service offered and its use (corporate or personal).

Finally, fringe benefits can be granted in the form of vouchers, either in paper or electronic format.

To be eligible to access vouchers, they must meet the following requirements:

• They must only be used by the holder;
• They must contain sums of money;
• To be used they must have access to only one service for the entire value of the voucher;
• They must be issued to the employee who benefits from this voucher;
• The service provided through vouchers can also be repeated over time.

It is very important not to exceed the value of 280 euros, otherwise your voucher will be subject to taxation.