For the tax year 2024 only – and as an exception to the ordinary exemption limit of € 258.23 – the following do not contribute to income within the overall limit of €1,000.00:
a) the value of goods sold and services rendered to employees, their spouses or family members,
b) the amounts dispensed or reimbursed to said employees for payment of:
- household utilities (i) integrated water service, (ii) electricity, and (iii) natural gas,
- expenses for first house rental, i.e., the rent resulting from the lease contract duly registered and paid in the year. ‘First house’ is defined as the employee’s main residence. Specifically, the expenses must relate to a property for residential use owned or held, on the basis of a suitable title, by the employee, the employee’s spouse or family members (art. 12, TUIR), and in which the employee habitually resides and provided that he or she actually incurs the relevant expenses,
- the interest on the mortgage related to the first house as defined above (art. 51, par. 3, TUIR; art. 1, par. 16-17 of Law No. 213/2023; Revenue Agency, circular message n. 5/2024).For 2024, the exemption limit is further raised to € 2,000.00 for employees with dependent children (Art. 12, par. 2, TUIR).
In the event that the aforementioned limits of € 1,000.00 or € 2,000.00 are exceeded, the value of fringe benefits contributes entirely to the income of employees.
The exemption scheme is applied by the withholding agent:
a) on condition that the employees concerned declare to the employer that they are entitled to the application of such scheme, indicating the child’s tax code and confirming that they have not filed another claim for reimbursement with another employer,
b) after informing company union representatives, if any.We remain available for any further clarification.