Secondments Without PIT and ZUS!
The annual tax settlement period is about to kick off at full speed, so it’s worth taking a closer look at certain employee benefits that have recently drawn the attention of tax authorities and administrative courts.
This time, we are focusing on employee secondments, specifically the costs of accommodation and transport.
Tax authorities still maintain that these benefits should be treated as non-cash income, which is not exempt from PIT and therefore should be subject to both PIT and ZUS.
But here comes the big surprise!
For quite some time now, WSA (Provincial Administrative Court) and NSA (Supreme Administrative Court) have firmly rejected this approach.
In what can be called revolutionary rulings, administrative courts—citing EU Directives—have emphasized that secondment-related costs, such as accommodation and transport, do not constitute taxable income from employment. This means no PIT and no ZUS!
While most rulings apply to secondments within the EU, it’s crucial to highlight that there are also judgments, such as the NSA ruling of May 9, 2024 (case no. 1154/21), which address secondments to non-EU countries and confirm that employees seconded outside the EU should be treated the same way.
According to the NSA decision, the destination of the secondment (EU country vs. non-EU country) cannot be the sole criterion for determining the employee’s tax situation, as this would lead to discrimination against employees seconded to non-EU countries.
How does it work in your company? Are secondment-related benefits subject to tax and social security contributions?
If you’re considering a different approach, feel free to contact Marta Dominiak-Sporna!