Production bonus: these are bonuses paid to the most efficient workers, in the form of cash or vouchers, here’s what they are and how they work
Production bonuses are bonuses paid to the most efficient workers, in the form of compensation in cash or in vouchers for welfare services, such as babysitting, kindergarten fees, caregiver, etc., to achieve a corporate productivity objective, in addition to the ordinary basic salary paid to the worker in the pay packet.
Production bonuses are a kind of reward contributions and are also defined as bonuses or result bonuses, aimed at reducing labor costs.
Therefore, they are highly rewarding, not only for the active workforce, i.e. employees, but also for the labor-producing companies themselves, which employ workers in the organization of the work itself, by paying them particular bonuses with incentive effects to achieve of productivity, fruitfulness, profitability, profitability, quality, efficiency and innovation objectives.
The companies, for their part, enjoy advantages linked to the decontribution, in fact they see a reduction of 20 percentage points in the IVS contributions that they are obliged to pay, as substitute tax, on behalf of their employees.
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The 2017 Finance Law has increased, since the 2017 tax period, the amount of the production bonus subject to the substitute tax, which is now set at € 3,000, instead of € 2,000 as established above, as well as € 4,000, to replace 2,500 euro, in the case of a production bonus granted by companies that adopt the joint participation of workers in the organization of work. As you can see on the website of the revenue agency .: www.agenziaentrate.gov
The equal involvement of workers, as established by circular no. 5 / E of the Revenue Agency, of 29 March 2018, must be formalized through an innovation plan and implemented with organizational schemes that allow employees to be involved in the processes of improvement and innovation of the company’s performance, with efficiency gains and productivity and improvement of the quality of life and work.
Fees received regardless of form are taxed:
Among the services that can be purchased through vouchers provided in the form of corporate welfare we have the following categories:
With the second-level contract, the employee can in fact convert his production bonus, which will no longer be received in the form of remuneration in the pay packet, in the aforementioned services
A particularly favorable regime has been introduced to encourage the payment of their contributions to supplementary pensions, in fact
the production bonus is not taxed, but does not contribute to the achievement of the maximum income deduction threshold.
Payments to supplementary pensions can be deducted from income within a maximum of 5,164.57 euros per year, in the event of payment of the production bonus, the limit becomes 8,164.57.
In the same way, we can say that for bodies or funds that have an exclusively assistance purpose, the production bonus is exempt from taxation, in fact the maximum limit of deduction provided for by the income is 3,615.20 euros, but that in case of payment of the production bonus it becomes 6,615.20.
In order to take advantage of the facility to deduct production bonuses, companies must electronically deposit second-level contracts bearing the employer’s references, the number of workers affected by productivity bonuses, the parameters set and the company contract applied. The Ministry of Labor in order to facilitate the electronic filing of contracts has prepared on the appropriate site www.cliclavoro.gov.it a section dedicated to the electronic filing of company contracts, after the company has registered on the site and has acquired its personal credentials.
The functionality of the deposit are linked to the following types of benefits:
If the employee decides to totally or partially replace the production bonus in order to obtain some benefits from the company, it automatically lapses from the benefit inherent in the deduction of production bonuses. They are, in fact, causes of exclusion from the benefit of the tax reduction of production bonuses:
The value of these benefits, determined pursuant to art. 51, paragraph 4, TUIR, is subject to ordinary taxation, it is not possible to subject them to substitute taxation.
The circular no. 5 / E, of 29 March 2018, establishes that a company in the absence of internal trade union representation may still apply the sectoral collective labor agreement and apply the substitute tax on performance obligations granted in execution of this territorial contract.
In the event that a contract for the territorial sector has not been stipulated, the company can adopt the territorial contract that it deems most appropriate for its reality, communicating it to the workers, which will be adopted not only in relation to the tax exemption, but also other aspects of the employment relationship.
For further information, I invite you to read the following circular of the Revenue Agency n. 5 / E of 29 March 2018 concerning production bonuses and corporate welfare Circolare_Agenzia_Entrate_29_marzo_2018_5
On the following site, however,www.ipsoa.it you will find examples on how to fill in line C4 of the 730/2018 form in which employee income and assimilated must be inserted in order to determine the correct determination of the IRPEF bonus in line C14.
Furthermore, it is necessary to pay attention and take into consideration the data reported in the CU certification Unica in point 571 and one of points from 572 to 579.
The substitute tax, or the employer, applies the substitute tax directly to points 572 and / or 582 bearing the following wording “Result bonuses subject to substitute tax” of the 2018 Single Certification and points 576 and / or 586 ” Substitute tax “or 577 and / or 587” Substitute tax suspended “.
The worker can always submit a waiver in writing and in this case the employer will not directly pay the substitute tax or the employer has verified that ordinary taxation is more favorable for the worker, in this case the points 578 and / or 588.
If you still have doubts about how the production bonus work, please write to us in the comments or contact us directly.