New limit for health-related benefits

In 2024, an annual limit for the exemption of employee non-financial leisure benefits from personal income tax was introduced, set at half of the average wage. However, this limit has proved insufficient, especially for health-related benefits, considered essential by both employers and employees. A proposal to amend the amendment to the Income Tax Act has been submitted during the discussion in the chamber of deputies, introducing a second specific limit up to the average wage only for health benefits. This limit would thus apply to reimbursements for the purchase of goods or services of a healthcare or similar nature provided by healthcare facilities or for the cost of prescription medical devices paid from the cultural and social needs fund, the social fund, after-tax profits, or tax non-deductible expenses.

In practice, this would allow employers to continue to cover vaccinations, physiotherapy, immunity-supporting vitamins and psychological counselling provided by healthcare facilities up to the above limit without any tax implications for employees.

If the amending proposal is passed, employers will be able to provide employees with tax-exempt health benefits equal to the average wage from 2025. This limit will be monitored separately from the limit for exempting leisure benefits from income tax, which is a half of the average wage.