As mentioned in our previous alert regarding this topic (Costs proper to the employer: don't forget the new reporting obligation (ey.com)), the reporting obligation for costs proper to the employer has changed as of tax year 2023 - income year 2022.
As confirmed by the law of 27 June 2021, and clarified in the circular letter 2022/C/62, also the variable cost allowances such as the reimbursement of actual expenses should be reported on the tax forms 281.10/20.
Former regulation
Under the previous regulation, there was only a reporting obligation for fixed cost reimbursements (article 57, °3 BITC). Failure to comply with these obligations could be heavily sanctioned with the non-deductibility of the professional expense and/or the application of the secret commission tax at corporate tax level of 100%.
For the variable cost reimbursements, where the employer reimburses the actual costs on the basis of supporting documents (e.g. an invoice), there was no such obligation.
New regulation as of income year 2022
As of income year 2022, the methodology of reporting reimbursements of costs proper to the employer has changed and also the variable cost allowances such as the reimbursement of actual expenses should be reported on the tax form 281.10 for employees and on the tax form 281.20 for company directors, regardless whether the reimbursements are being processed through the payroll or not. Additionally, it is now mandatory to indicate the actual amount of the allowances for each category.
With these new obligations, the tax authorities aim to get a better understanding of the amounts that are granted as a reimbursement of costs proper to the employer and, in practice, to ensure the same costs are not being covered by different reimbursements (double dipping).
Summarizing overview of the new regulation: