The most important things you need to know about a gross salary scheme.

Do you know how VAT deductions work, how to account for a salary sacrifice scheme, how to integrate it with payroll systems, how the multimedia tax applies, or how hourly employees can benefit from salary sacrifice schemes? If you’re not entirely sure how it all works, you’re not alone. All the answers you need are right here in this article.

You’ll also learn how a salary sacrifice scheme is calculated and how to get the most out of it. Salary sacrifice schemes have become highly attractive. They offer tax advantages and flexibility, but they also come with a range of rules and requirements that must be followed.

Gross Salary Scheme and Multimedia Benefits

If you order a phone or accessories for your phone through your gross salary scheme, it will always trigger a multimedia tax.

Multimedia tax (also known as tax on free phone) means that if your employer provides you with a phone, accessories, or internet access that you can also use for personal purposes, you must pay tax on it.

It is a fixed annual tax added to your income because the tax authorities (SKAT) consider it a benefit from your employer. So, if you receive a mobile phone from your employer and use it for both work and personal purposes, you will have to pay a little extra tax for it. The tax is fixed regardless of how many multimedia devices you have.

Note: You may be eligible for a “spouse discount” if both you and your cohabiting spouse have products subject to multimedia tax. In that case, the taxable value is reduced by 25% for each of you.

You can read more about multimedia tax, regulations, and applicable products on SKAT’s website.

Computer Taxation (værnsregel)

Computers are not subject to multimedia taxation.

If you order a computer through a gross salary scheme, it will always trigger computer taxation (also known as værnsreglen). This also applies to tablets, computer monitors, and other accessories related to computers and tablets.

With computer taxation, you will be taxed on 50% of the product’s value. It is the employer’s responsibility to report this to the Danish Tax Agency (SKAT). The company decides whether the tax is reported monthly or annually.

How is a Gross Salary Scheme Calculated?

We have developed a calculator that shows the significant savings you can achieve by ordering your work equipment through a salary sacrifice scheme instead of paying full price in stores.

All you need to do is find the product or service you are considering for your salary sacrifice scheme and enter the price.

You can find our calculator right here.

How is a Gross Salary Scheme Booked? (Integration)

Gross salary schemes are recorded by noting the value of the chosen benefit as a company expense while simultaneously reducing the employee’s gross salary by the same amount.

This means that the company covers the cost of the benefit, but offsets it by reducing the employee’s salary accordingly, making it a zero-sum transaction for the company.

Can Hourly Employees Use a Gross Salary Scheme?

Yes, hourly employees can also use a gross salary scheme, as long as the benefit is relevant to their work, and the reduction in salary is fixed and lasts for at least 12 months.
Many believe that such benefits are only available to full-time employees, but this is not the case. While it may involve some risk to enter into agreements with non-permanent employees for 12-month periods, we have a solution for that. If the employee ends their employment, they can choose whether the item should be returned or bought outright. If the item is to be returned, we provide a return label free of charge. If the employee chooses to keep the item, they can purchase it outright through their personal control center, with no further involvement from the company in the administration.

Thus, it is completely risk-free for the company to offer a gross salary scheme to its employees, as there is no risk of being left with unused equipment that the company no longer needs.

Gross Salary Scheme VAT

SKAT allows VAT deductions for the portion of equipment used for business purposes. Therefore, it may be a good idea to transfer the portion of VAT that the company cannot refund to the employee’s gross salary deduction.

Table of Contents

The most important things you need to know about a gross salary scheme.

Gross Salary Scheme and Multimedia Benefits

Computer Taxation (værnsregel)

How is a Gross Salary Scheme Calculated?

How is a Gross Salary Scheme Booked? (Integration)

Can Hourly Employees Use a Gross Salary Scheme?

Gross Salary Scheme VAT

Let's start a conversation

A risk free solution

Always know what you pay

Support

Solutions

Conditions

+45 89 808 404

hej@flexbuy.dk

The most important things you need to know about a gross salary scheme.

Gross Salary Scheme and Multimedia Benefits

Computer Taxation (værnsregel)

How is a Gross Salary Scheme Calculated?

How is a Gross Salary Scheme Booked? (Integration)

Can Hourly Employees Use a Gross Salary Scheme?

Gross Salary Scheme VAT

For Pentia, staying updated is important – and they can do that with leasing

Five Easy Ideas for Employee Benefits That Can Boost Your Business

Choose Your Own Device (CYOD)

A risk free solution

Always know what you pay