An amendment to the Labour Code (Act No. 319/2019 Coll. amending Act No. 311/2001 Coll. Labour Code, as amended, and amending certain laws) will enter into force on 1 January 2020. The amendment introduces a new type of benefit regulated by law – a sport activity allowance. Below you can read more about this benefit.
Only voluntary
The structure, concept and amount of the sport activity allowance is very similar to the recreation allowance that was introduced in Slovakia at the beginning of 2019. However, the difference is, that the sport activity allowance can be provided by employers to employees on a voluntary basis. It is not mandatory.
Not taxed
The alleged motivation for the employers to provide this new benefit to the employees should be the favourable tax treatment of the benefit. It is not taxed (as opposed to other standard benefits provided to employees) and it is also a tax expense of the employer.
Eligible employees
Employees who are continuously (without any interruption) employed at the employer at least 24 months, can receive the sport activity allowance under the favourable tax regime (if the employer decides to provide it to its employees). Of course, the employer can provide a similar benefit also to other employees (e.g. who are employed less than 24 months) but in that case the benefit will be subject to a normal (standard) tax regime – both on the part of the employer as well as on the part of the employee.
Amount
The amount of the sport activity allowance is 55% of eligible expenses but not more than EUR 275 in total per one employee in respect of all the employee’s children in total in one calendar year. The eligible expenses are the expenses that the employee incurs in relation to sport activities of the employee’s children performed at a sport organisation registered in the respective register of sport entities. Within 30 days after the issuance of the respective documents by the sport organisation, the employee shall submit to the employer the respective documents issued by the sport organisation containing the name and surname of the employee’s child and the time period covered by the documents, and thus prove that the employee has incurred the eligible expenses. The employer shall reimburse the eligible expenses to the employee in next pay day unless agreed otherwise with the employee.
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This legal summary was prepared in November 2019 exclusively for the purpose of providing general information and should not be viewed as legal advice. The aforementioned overview is not comprehensive, but only provides a brief summary of the relevant legislative changes.