Substitution of monetary remuneration for language training ticket: retribution in kind

The DGT points out that the nominative, numbered and non-transferable tickets that an entity gives to its workers in general to cover the cost of the language academies, within the framework of a flexible compensation plan, and without being conditioned by the activity or Work place developed, they are considered in-kind compensation unless the training is required by the activity or job developed in the company.

The employees of an entity interested in receiving language training agree with it to modify their employment contracts to introduce a change in the composition of the remuneration system. In this way, a monetary remuneration is replaced by another one in kind consisting in the delivery by the entity of “tickets language training” to the workers. These tickets are nominative, numbered and non-transferable and are intended to satisfy employees the cost of language schools to which they come in order to learn or improve a language.

The General Directorate, based on the fact that the remuneration in kind described has been agreed with the workers in the work contract itself, leaving the company obliged to provide said service, for which the amounts paid by the same to the language academies are not consider an assumption of payment mediation, it would be necessary to determine if the described assumption fits into the definition of what is not considered as compensation in kind.

In this sense, the assumption fits in regard to its configuration in the form of tickets, since the purchase of tickets by the entity for its employees and that these in turn deliver to the language academies that provide them with the service of The amount of the teaching is not less than the amounts allocated by the company for the updating, training or recycling of the personnel employed, thus fulfilling this purpose.

A different issue is the fulfillment of the updating, training or retraining of the employed personnel required by the development of their activities or the characteristics of the jobs, which can not be considered concurrent in general, since the delivery of tickets is optionally allows all workers without being conditioned by the activity or job developed, so that such amounts are subject to income tax as income from work in kind, notwithstanding that in particular cases in which this requirement is met do not have such consideration.

Consultation DGT V3207 / 2018 of December 18, 2018. EDD 2018/133664