Reimbursement of costs proper to the employer based on supporting documents: reminder and differentiation

Expense reimbursements determined on the basis of supporting documents must be mentioned on the tax sheet as of income year 2022. The FPS Finance softens this obligation when repaying an advance. 

Context

Expenses proper to the employer granted to the employees are stated on tax sheet 281.10 in the 'Various information' box. For company managers, these expenses are stated on tax sheet 281.20.

Radical changes are planned starting in income year 2022, including a listing of the amounts for all types of expense reimbursements on the tax sheet.

The reimbursement of expenses established on the basis of supporting documents will therefore have to be mentioned on the tax sheet 281.10 and/or 281.20, irrespective of whether the reimbursement is made through payroll processing or a direct payment to the employee or company manager (outside payroll processing, e.g. a reimbursement through accounting).

You can find more information about these changes in our Infoflash of 28 October 2021.

Concrete cases

In a recent circular, the FPS Finance explains the sheet obligation in two specific cases.

Crediting the business manager's current account

The reimbursement of costs proper to the employer can be done by crediting the current account of a company manager. The allocation must also be included on the tax sheet.

Reimbursement of an advance

The following situation may occur:

• the employer or company makes a professional purchase transaction of goods or services in its own name;
• the employee or manager is limited to advancing the payment, i.e. he pays for those goods or services with his own funds.

In that case, it is a purchase made by the employer or the company, not a purchase made by the employee or manager. The FPS Finance stipulates that the reimbursement of those costs must not be included on the tax sheet.

Important note! The above reimbursement must not be reported only when it is clear from the outset that:

• the purchase transaction is done by the company or employer;
• the justification for the purchase includes the identity of the company or employer. As a rule, this is a legally valid invoice, in the name of the company or employer.

If these conditions are not met, then the reimbursement of costs must be reported on the tax sheet.

Examples:

• An employee purchases small office supplies to use in the office. The employee receives a receipt for €50. This reimbursement of the employer's own expenses must be reported on the tax sheet.
• An employer instructs one of his employees to purchase printing paper for the office in his name. The invoice is in the name of the employer but the employee advances the payment (he pays with his own private account). The employer then reimburses the amount advanced. The FPS Finance ruled that in this case the employer was purchasing the printing paper, not the employee. This reimbursement of costs must therefore not be reported on the tax sheet.

Customer of Partena Professional?

If you are awarding expense reimbursements based on supporting documents outside of the payroll calculation, please contact your Payroll Consultant to agree further practical details on how to communicate the information on the amounts awarded from 2022. In this way, the delivered tax sheets will comply with the changes in the reporting obligation.

Be prepared!

The indication of the amounts of the expense reimbursements and the reporting of reimbursements based on supporting documents on the tax sheet ensure that the FPS Finance has insight into the granted expense reimbursements. It contributes, inter alia, to checking the possible double use of flat-rate reimbursements and reimbursements on the basis of supporting documents.

It is therefore strongly recommended to scrutinize your company's expenses policy to ensure that the reimbursement of expenses and their amounts are not questioned. Would you like support in evaluating your expenses policy? Or would you like to draw up a company policy on expense reimbursements? Please do not hesitate to contact our Legal Partners at legalpartners@partena.be.

Sources: Act of 27 June 2021 containing various tax provisions and amending the Act of 18 September 2017 on the prevention of money laundering and terrorist financing and limiting the use of cash, Belgian Official Gazette of 30 June 2021; Circular 2021/C/20 on contributions from the employer for telework; Circular 2022/C/62 on the justification of reimbursements of costs proper to the employer.