Updates from the law converting the Advance Payments Decree

News Flash No. 1/2024

On December 17, 2023, Law No. 191 came into effect, converting Decree-Law No. 145/23 (known as the “Advance Payment Decree”).

Here is a summary of the main changes in labor law:

Fringe Benefits on Loans Granted to Employees

We wish to focus particular attention on the amendment to tax regulations concerning loans granted by employers to employees, given the significant burden that the previous regulations placed on employees, caused by the sudden rise in reference rates implemented by the ECB over the past year.

In Article 3 of Decree No. 145/23, paragraph 3-bis has been added after paragraph 3, amending Article 51, paragraph 4, subparagraph b) of the TUIR, so that in the case of loans granted to employees, “50% of the difference between the amount of interest calculated at the official reference rate in effect on the due date of each installment or, for fixed-rate loans, on the date the loan was granted, and the amount of interest at the rate applied to such loans.”

Consequently, when calculating any fringe benefits:

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