Shift work - withholding tax non-remittance exemption

New perspectives for the exemption from withholding tax for teamwork

When employees work in a shift or at night, employers can benefit from an exemption from withholding tax of 22.8%. In order to benefit from this fiscal measure, various conditions must be met. One of these required that the work done by the teams is the same in terms of scope.

This concept, which seems simple, is proving to be a subject of disagreement and creates legal uncertainty, as its application can give rise to different interpretations.

Elimination of the equivalent magnitude constraint

In order to clarify this concept and to provide better legal security, a draft law “teamwork bis” was recently introduced by the government. This transitional measure, applying to withholding taxes paid from January 2021 to December 2026, aims to establish new guidelines on how to take into account the concept of scope in terms of teamwork, eliminating the requirement to have an equivalent amount between teams to benefit from the exemption.

When implementing the measure, the employer has two options:

• Continue to use the measure in force up to now; or
• Opt for the method of calculating in proportion to the extent detailed in the new regulations.

“Bis teamwork”, a new approach in proportion to the extent

Under this new approach, the teams are no longer required to perform work of the same magnitude to benefit from the exemption. The amount of the exemption is adjusted according to the variations in magnitude between the successive teams during the month in question.

The implementation of this measure requires precise monitoring to calculate the variations in magnitude between successive teams on a daily basis, and then to consolidate this data at the monthly level. This approach requires careful administrative management.

ABV Development accompanies you throughout your procedures.

Our experts are available to answer your questions, carry out in-depth analyses of your situation, verify the correct application of the measures in force and help you find the solutions that best suit you.