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What are the tax-free fitness activities?

Previously, the Swedish Tax Agency has published a list of approved wellness activities. However, the list will be deleted at the turn of the year. Because of this, the much freedom is given to the employer to approve different types of exercise activities that contain elements of exercise, regardless of what they are called.
Usually, cash benefits and benefits that an employee receives from his employer are taxable. However, there are some exceptions. An exception is that the employer can issue employee care benefits. Personnel care benefits are benefits of lesser value. These are simpler measures to create job satisfaction or the like. Examples can be coffee, tea, non-alcoholic beverage, fruit, bun or simple sandwich. Personnel care benefits are normally provided at the workplace. Personnel care benefits in the form of exercise or other wellness are other examples. Exercise / fitness benefits can be provided through benefits in kind and through fitness grants.

It is voluntary for employees to take advantage of staff care benefits.

Exercise / wellness, benefit in kind

When the employer decides and directly pays for activities for exercise / wellness, it is a benefit in kind. Examples of such benefits may be that staff have access to a gym or receive massage treatments. An employer who has employees in different locations and offers the employees exercise opportunities must do this in all locations, but it can then be a varied arrangement.

Exercise / wellness, wellness contribution

When the employer offers the employees a certain amount that they can use at their own choice for exercise / fitness activities, it is called a fitness allowance.

It is the employer who must show that the conditions for tax exemption are met. It is the employer who decides what type of activities he wants to approve. An employee can never demand that the employer approve a certain activity.

Less value

The expression “lesser value” means that the personnel care benefit must not cost too much.

The expression lesser value is assessed for each type of personnel care benefit separately. For example, if an employee receives refreshments at the workplace, this does not affect the assessment of an exercise / fitness benefit. On the other hand, the assessment will be different if the employer provides a number of personnel care benefits of a similar nature. If, for example, the employer offers the employees tennis, swimming and gymnastics as a benefit in kind, the total value of these benefits must be of lesser value.

With regard to wellness allowance, an amount of a maximum of SEK 5,000 including VAT per employee and year is a minor value.

Unlike with regard to wellness allowance, there is no fixed amount limit for what is considered to be less value when wellness is paid in the form of benefits in kind. This is because prices vary between different locations and because it can be difficult to determine a market value for exercise facilities in connection with the workplace. Instead, an assessment must be made in each individual case as to whether the value of utilizing the gym facility or a corresponding benefit in kind can be considered to be of lesser value and simpler.

An employer that provides a benefit in kind can also offer the employees a wellness allowance. When an employer offers both a benefit in kind and a wellness allowance, the limit of SEK 5,000 in total may be exceeded without any taxation being actualized.

Tip

Given that the list disappears at the turn of the year, it may be wise to print it out before then. After all, it can be of some help in assessing whether a certain activity can be considered a staff care benefit or not, see e.g. adventure pool which according to the Swedish Tax Agency is not a tax-free benefit. In the event of uncertainty as to whether a certain activity can be considered a tax-free benefit or not, it is of course possible to ask the Swedish Tax Agency for an assessment in the individual case.

Source: https://www.tidningenkonsulten.se/

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