- The interpretation allowing deductions for employee contributions for employee benefits, gifts, and other donations in the calculation of the threshold amount for the Exclusion of Deductible VAT Decree 1968 (BUA) will be terminated.
- The BUA includes a special regulation that requires the correction of input tax deduction in certain cases.
- The BUA applies to goods and services used by entrepreneurs for donations to non-deductible persons and employee benefits.
- A threshold amount of €227 is introduced in the BUA, below which no correction of input tax deduction is required.
- The calculation method for determining if the €227 threshold is exceeded is specified in Article 4, first paragraph, of the BUA.
- The interpretation on the website of the Tax Authorities allowing deductions for employee contributions is not in line with the text of Article 4, first paragraph, of the BUA.
- The interpretation on the Tax Authorities’ website will no longer be followed from January 1, 2024.
- The calculation method specified in Article 4, first paragraph, of the BUA must be used for applying the flat-rate percentage by municipalities for employee benefits.
- Employee contributions for employee benefits, gifts, or other donations can no longer be deducted from the total expenses.
Source: efkbelastingadviseurs.nl
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
