Gifts offered by companies on the occasion of Women's Day (March 8th) benefit from a preferential tax regime in Romania. The legislation provides for exemptions from income tax and social contributions within certain limits, thus encouraging employers to offer small tokens of appreciation to female employees without the burden of salary taxes. Additionally, companies can partially deduct these expenses when calculating corporate income tax.
Non-taxable income (gifts up to 300 EUR per employee)
According to the Codul fiscal (Tax Code), gifts in cash and/or in kind (including gift vouchers) offered by the employer to female employees on the occasion of March 8th are considered non-taxable income, up to a limit of 300 EUR per person for that event. In other words, if the value of the gift granted to a female employee for Women's Day does not exceed 300 EUR, the employer does not owe income tax on this amount. This facility is provided by art. 76 para. (4) let. a) of the Codul fiscal, which lists the situations (including March 8th) where gifts granted to employees are non-taxable within this limit.
Social contributions – exemption of gifts from the calculation base
Under the same conditions (occasional gift for March 8th, worth a maximum of 300 EUR/person), no mandatory social contributions are paid for these benefits. The Codul fiscal stipulates that such gifts are not included in the monthly calculation base for pension contributions (CAS), health insurance (CASS), or the labor insurance contribution (CAM). This exemption has a legal basis in art. 142 let. b), art. 157 para. (2), and art. 220^4 para. (2) of the Codul fiscal, which explicitly exclude these gifts from the social contributions calculation base.
Taxation of gifts exceeding the 300 EUR threshold
Exceeding the 300 EUR threshold per person results in the loss of tax facilities for the excess amount. According to tax regulations, the portion of the gift that exceeds 300 EUR becomes taxable salary income, being subject to income tax and standard social contributions. Thus, for the value exceeding the limit, the employer must calculate and pay to the state the 10% income tax (flat rate) applied to the excess amount, as well as mandatory social contributions: pension contribution – CAS (25%), health contribution – CASS (10%), and the labor insurance contribution – CAM (2.25%). In practice, only the difference over 300 EUR is taxed, while the sum of 300 EUR remains non-taxable and exempt from contributions, according to the facilities described above.
Deductibility of expenses related to these gifts
In addition to salary tax exemptions, the legislation also offers an advantage in calculating the corporate income tax for companies granting such gifts. Expenses incurred by firms for March 8th gifts (cash, goods, or gift vouchers offered to female employees) are considered social expenses, deductible within certain limits. According to art. 25 para. (3) let. b) of the Codul fiscal, these expenses are limitedly deductible, in an amount of up to 5% of the total staff salary expenses. In practice, the company can deduct the value of gifts offered to employees when calculating corporate tax, provided that the total of all social expenses (including gifts for March 8th and other similar occasions) does not exceed 5% of the salary fund. If this 5% threshold is exceeded, the excess part of the social expenses becomes tax-nondeductible (it no longer reduces the profit tax base).