Optimising Christmas gifts: rules for employers in France
by Elise Thijs and Elise Vanhamme
With the festive season just around the corner, it is a good time for employers to consider how they can reward their employees in France for their efforts over the past year. While any amount or benefit is considered a salary and is therefore subject to social security contributions, there are some exceptions that allow employees to be rewarded in a way that is advantageous from a social security and tax perspective.
There are certain conditions that must be met in order to benefit from this favourable regime. Over the course of a year, the total value of the gifts granted per employee may not exceed 5% of the monthly social security ceiling, or EUR 183 in 2023.
If this limit is exceeded, the following three conditions must be analysed for each case:
The first condition is that the gift must be linked to a specific event. These specific events are
Birth or adoption
Marriage
Retirement
Mother's or Father's Day
St Catherine's Day or St Nicholas' Day
Christmas
Back to school for employees with children
A second condition is that the voucher must specify the type of items that can be purchased with it, either one or more departments of a large department store, or the name of one or more specific stores. In addition, the voucher may not be redeemed for fuel or food, with the exception of common luxury foods with a demonstrably festive character (such as champagne).
Special rules apply to Christmas. The employer may give a gift not only to the employee but also to the employee's children up to and including the calendar year in which they reach the age of 16. However, the gift must be Christmas-related, such as toys, books, clothes, sports equipment, etc.
The last condition is that the amount of the gift must be in line with what is customary for the occasion, without exceeding 5% of the monthly social security ceiling (for 2023, this threshold is set at €183). Employers can therefore provide vouchers or gifts that are exempt from social security contributions, provided they are within this threshold.
If all three conditions are not met, the Christmas gift or voucher will still be subject to social security contributions. It is therefore essential that employers plan carefully and comply with the specific conditions in order to obtain the maximum benefit from rewarding their employees during the festive period.
For more information or advice on these issues, please contact one of our experts.
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Elise Thijs
Paralegal elise.thijs@vdl.be
Elise Vanhamme
Senior Advisor Social Legal elise.vanhamme@vdl.be
Disclaimer
In our opinions, we rely on current legislation, interpretations and legal doctrine. This does not prevent the administration from disputing them or from changing existing interpretations.
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