The Work-Related Costs Scheme (WKR in Dutch) enables you to provide tax-free benefits to your employees under certain conditions. The WKR covers three key aspects:
- The taxation of labor costs;
- Exemptions;
- The discretionary scope for allocation.
What can the WKR mean for your employees, or for you as a director-major shareholder? We will explain this in our whitepaper.
What is the discretionary scope?
The discretionary scope is comprised of a percentage of a company’s wage bill, which includes the total taxable income of all employees. This includes various components such as basic salaries and fiscal additions like company car benefits.
What advantages does the WKR offer to your employees?
Increasing an employee's salary could significantly elevate your labor costs relative to their net income. The WKR provides a potential remedy by allowing allocation of up to 2,400 euros per employee annually to the discretionary scope, without additional conditions.
Who oversees the WKR?
The payroll department primarily handles processing fixed cost reimbursements, provisions, and potential final levy taxes in the payroll tax return. However, certain reimbursements are managed directly by the financial department, while expenses such as staff outings are handled by HR. Hence, effective coordination among these departments is vital.
