Návrh zavedení samostatného limitu pro osvobození tzv. zdravotních benefitů

Proposal to introduce a separate limit for the exemption of so-called health benefits

An amendment has been submitted in the legislative process to introduce a separate limit for the exemption of so-called employee health benefits from personal income tax, up to the amount of the average wage for a particular year (for 2025 the amount is CZK 46 557). The amendment is scheduled to take effect on 1 January 2025.

The special limit will apply to "the purchase of goods or services of a medical, therapeutic, hygienic or similar nature from health care institutions or the purchase of medical devices on prescription", while it will continue to be the case that the amount exempted from tax and insurance premiums on the part of the employee will generally be provided by the employer from tax non-deductible expenses.

The amendment responds to feedback from employers and trade unions that health benefits are the most valuable group of benefits for employees and that by providing them employers often implicitly save on public health care costs.

For the sake of completeness, we would like to add that the remaining group of non-monetary benefits (e.g. the use of educational facilities, sports facilities, contributions to cultural and sporting events, etc.), for which an aggregate limit for tax exemption of half of the average wage was introduced by the previous amendment, will continue to retain the same limit (for 2025 the amount of CZK 23 279).

The proposed change is a welcome expansion of the ability for employers and employees to provide exempt benefits, but it will also mean an increase in administration in tracking the various limits.

Not only the topic of employee benefits will be covered in more detail during our webinar Employees in 2024 and 2025 - Current Issues (more information and registration HERE), which will take place on 20 November 2024.

For further information and consultation on the practical implications of this legislative change, please contact our tax specialists.

Authors:

Michaela Felcmanová

Adam Linek