Starting from 2018, the sports allowance made to employees will no longer be taxed on the quarterly payment in the amount of 100 euros. However, the discount is valid if the employer applies this option to all employees.
For the purposes of sports allowance, an employee is:
- a person working under an employment contract;
- public service employee;
- member of the management or control body;
- a self-employed person who sells goods to an employer for a period longer than six months;
- a natural person working or providing services based on an employment, agency or other contract under the law of debt.
- The tax discount does not apply to the employee’s spouse, partner or other relatives.
Tax-free sports grants are:
- public sports event participation fee;
- expenses directly related to the regular use of a sports or exercise venue;
- expenses for the maintenance of the employer’s existing sports facilities;
- expenses incurred in the health management information system or for the services of a rehabilitation doctor, physiotherapist, occupational therapist, speech therapist or clinical psychologist with a corresponding professional certificate;
- health insurance contract premium.
- 100 euros of sports allowance per employee per quarter and cannot be transferred to another quarter or aggregated;
- 100 euros is the amount including VAT, and input sales tax cannot be claimed back on health and sports expenses incurred for the employee.
- if the employee has several employers, each employer can apply a tax-advantaged sports allowance to him in the amount of 100 euros per quarter;
- an expense document is required to pay the sports allowance;
- it is necessary to keep personal records;
- the tax discount does not apply to the purchase of equipment necessary for the hobby;
- the tax discount also extends to health and sports expenses made outside Estonia and additional services such as catering, transport, parking, wardrobe, etc.
Public sports events mean various public event series and individual events. A public sports event is characterized by: public notification, participation schedule, rules, comparison of results between participants, recognition of the best. Public national sports events are not, for example, in-house sports days or similar events aimed at a narrower target group.
Sports and exercise places are public and in-house sports clubs.
Sports and exercise places are:
- stadiums, fields and halls specific to sports;
- gymnasium, artificial fields, halls, health facilities, bicycle paths;
- green areas, parks, streets, squares.
Meditation and mindfulness, beauty salon services, LPG, roller massage, agility, etc. are not considered expenses related to sports or exercise.
Acquiring the services of a water center, spa, sauna world in such a way that you do not do sports/training regularly is not subject to tax incentives.
Insurance premium of medical insurance contract
Upon agreement with the employee, the employer can sign a health insurance contract with the insurance company for the employee. This gives the employer the opportunity to cover the employee’s medical expenses free of charge up to the limit of the tax allowance or to compensate the employee’s expenses on the basis of an expense document. Voluntary health insurance is necessary for those who for some reason are not covered by the health insurance of the health insurance fund or cannot/do not want to purchase it separately from the health insurance fund.
Example: An employer signs a health insurance contract offered by the Health Insurance Fund for a person who does not have state health insurance (e.g. a person working under a contractual agreement and his monthly fee is lower than the monthly rate based on the minimum obligation of social tax.
Anno 1992