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Monday, 20 April 2020

My employees are working overtime. Are there any tax incentives I could benefit from?

In a press release of 11 April 2020, the government announced a second wave of measures to support the Belgian economy. One of these measures which is soon to be expected, is a tax exemption for voluntary overtime performed in critical sectors in the period from 1 April 2020 until 30 June 2020.

Based on what circulates, the new regime will allow employees, working in a critical sector, to perform maximum 120 additional overtime hours during the period 01/04/2020 – 30/06/2020, next to the existing regime of voluntary overtime hours. The maximum of overtime hours performed by these employees will be 220 per year (existing + new regime).

The new regime will have the following key features:

  • Gross salary = net salary (tax and social security exemption)
  • No overtime pay is due
  • No recuperation time must be granted

For employers active in critical sectors, who are in a great need of employees willing to work due to an increase of activities, this proposal is definitely a welcome measure in order to motivate employees to perform overtime hours amid the on-going COVID-19 pandemic - to be followed up!