Tax & Payroll

Professional wage withholding tax exemption for real estate work

Analyze the eligibility of your on-site activity and secure the application of this tax measure with ABV Development.

Aerial view of a construction site in progress

The exemption from professional wage withholding tax for real estate work is a specific variation of the general scheme applicable to team and night work. It is tailored for companies performing real estate work, as defined by the VAT Code, on site.

Employers can retain a portion of the professional wage withholding tax deducted from salaries, instead of remitting it to the State. If the measure was not applied in the past, a recovery for previous years is also possible under certain conditions. ABV Development assists companies in analyzing their eligibility and securing the proper application of this measure.

18%Maximum tax benefit : eligible salary base for team-based real estate work on site

€17.67Minimum hourly wage threshold required for applying the exemption (2026, to be indexed)

Carpenter worker working wood on a construction site, illustration for Exemption from payment of withholding tax for real estate work

Conditions for applying the exemption for on-site work

To be eligible, the work must be performed on site (construction site) and qualify as real estate work under the VAT Code. The services must be carried out by a team of at least two workers (excluding students and apprentices) performing the same or complementary work.

Eligible workers must perform at least one-third of their monthly hours as part of a team on site. A minimum gross hourly wage is also required (€17.67 in 2026, to be indexed). The analysis of these criteria is based on a practical interpretation of work organization, job functions, and available operational data.

Worksites exceeding EUR 30,000 must be declared to the NSSO. When a subcontractor is involved, this threshold is reduced to EUR 5,000. For worksites above EUR 500,000, workers’ presence must also be registered via CheckInAtWork.

Hands resting on unrolled architectural plans, illustration for Exemption from payment of withholding tax for real estate work

01

Nature of activities performed

The classification of services under the VAT Code is a fundamental prerequisite. Real estate works are not limited to construction activities in the strict sense. They can also cover other interventions carried out on site, such as electrical work, maintenance of infrastructure or public spaces, or certain technical operations related to a building.

A precise analysis of the nature of the activities is therefore essential to correctly determine eligibility for the measure.

02

On-site presence and team composition

The actual presence of workers on site and the correct composition of teams must be documented. The number of workers per team, their qualifications, and their roles are determining factors. Teams including students or apprentices do not meet the eligibility requirements.

03

Consistency between planning, timekeeping, and payroll

The application of the exemption relies on the consistency between planning data, actual timekeeping, and payroll data. Any discrepancy between these sources can weaken the case during an audit. Rigorous verification of this data is a key element for securing the exemption.

04

Risks associated with incorrect application

A misinterpretation of the criteria can lead to the rejection of the exemption during a tax audit and a challenge to the amounts applied. ABV Development structures documentation to secure the company's position and prevent these risks from the initial analysis.

Wage withholding tax exemption for shift and night work

Benefit from withholding tax exemptions for shift and night work to reduce your payroll costs.

Tax audit assistance

Defend your interests during tax audits with specialised expert support.

Public Grants for HR and Training

Identify and leverage available public grants for your human resources and training needs.