The bicycle benefit is an advantage offered by the employer to the employee. The tax authority confirms the amount of the tax-free portion annually. In Netvisor, it is possible to handle the bicycle benefit in different ways. The bicycle benefit must always be reported on the payroll report even when it does not result in a taxable benefit. Below is an example of different ways to handle the bicycle benefit in Netvisor. The user guide does not cover all cases. Always remember to check the applicable regulations from the authorities at the time of handling.

Please note that changes have been made to the handling of the bicycle benefit starting from the beginning of 2026. More information in the Community update: Income register updated guidelines for bicycle benefit and transition period


Handling the vat increase of the bicycle benefit

The company decides on the handling of the bicycle benefit, whether the portion possibly exceeding the tax-free benefit is grossed or netted in payroll. The handling of the vat increase depends on many different factors, such as how the salary types are constructed in Netvisor and whether the bicycle benefit is completely tax-free or if there is a portion considered as pay or if it reduces the salary in money.

If the value of the bicycle benefit continues to be up to 100€/month and it remains entirely tax-free, it is sufficient to update this new tax-free value in the employee's salary basis. If part of the bicycle benefit is handled as tax-free and part as taxable, only the taxable portion needs to be edited so that the total amount corresponds to the new value of the bicycle benefit. 

Below is an example of how to create a new salary type for the increase.

You can create a new salary type using this guide: Create a new salary type

The source for the salary type is given as "employee's salary basis", so that a fixed value can be set in the salary basis for those employees affected by the increase. The salary type is given the income type instructed by the Income Register. The salary type is linked to the salary model's "to be paid" formula as a deduction (minus) or added to the gross pay, like other fringe benefits.

What to do if there is no ready example in the guide?

If there is no suitable option found in the user guide examples, new salary types can be created in Netvisor according to needs. 

Guide: Create a new salary type

If you need help creating new salary types, you can send a support request with an example explaining the salary types, amounts, and income type allocations, how you want the payslip to be formed. The most important thing is that the message in the support request clearly shows what the desired outcome is on the payslip.

Example:

  • Monthly salary xx
  • Salary in money xx
  • Gross pay xx
  • Bicycle benefit xx
  • TyEl xx
  • Tyva xx
  • Withholding tax xx
  • Net wage or salary xx
  • To be paid xx

If necessary, new salary types and formulas can be ordered from trainers, which is a chargeable service.

The Income Register guides in the income types of salary types and how the bicycle benefit should appear on the payroll report so that it passes to the Income Register.

The income types for bicycle benefit in use in Netvisor are:

363 Tax-free portion of bicycle benefit

364 Portion of bicycle benefit considered as pay

420 Compensation collected from bicycle benefit

CONTENT

Example 1. Handling when the bicycle benefit is at most the tax-free value defined by the tax authority and no benefit considered as pay is formed

If the employee has a regularly handled, same-sized bicycle benefit, it is advisable to give this a fixed value per employee in the management of salary basis. For handling, you need a salary type for which the value is defined. You can create a new salary type and name it, for example, “Employee-specific bicycle benefit”:


Pay > Payroll > Salary model management > Company-specific salary types > Add new salary type

Create another salary type from company-specific salary types, name it, for example, “Bicycle benefit tax-free”:

Link the created salary types “Employee-specific bicycle benefit” and “bicycle benefit tax-free” with a formula to each other as shown in the image below:

Pay > Payroll > Salary model management > Select from salary model > Formulas > Salary type formulas tab > Link salary type to salary model: > Select salary type "Bicycle benefit tax-free"


Give employee-specific amounts of tax-free bicycle benefit in the section Pay > Personnel > Salary basis management:


In this example, the employee's pay is 2000 euros. The bicycle benefit is 100 euros. Now when forming the payslip, the employee's tax-free bicycle benefit appears on the payslip:

The amount also appears on the payroll report, but the benefit does not affect payroll values such as withholding tax, employer's contribution, or health insurance payments. The salary in money remains the original amount of the employee's pay.

Example 2. Bicycle benefit, which is partially tax-free and part is considered as pay

If the amount of the bicycle benefit exceeds the annual tax-free upper limit value for the employee, taxes and employer's contributions must be collected from the exceeding portion. In this case, two reportable income types must be obtained on the payroll report: 363 Tax-free portion of bicycle benefit and 364 Portion of bicycle benefit considered as pay. You need salary types for the tax-free portion of the bicycle benefit (as in example 1) and the taxable portion. The salary type for the taxable portion defined per employee can be created with the following information:

Also create a salary type to handle the taxable portion on the payslip with the following information:

Link the created salary types to each other with a formula as shown in the image below:

Now give the employee's information in the section Pay > Personnel > Salary basis management > per employee the information of the tax-free and taxable portion:

Remember to add the salary type “Bicycle benefit taxable” as a plus in the formula for Gross pay, so that the basis for calculating withholding tax and employer's contributions is formed correctly. In this example, the employee's pay is 2000 euros, the value of the tax-free bicycle benefit is 100 euros, and the portion of the taxable bicycle benefit is 20 euros.

Example 3. Bicycle benefit which is at most the tax-free value defined by the tax authority, the benefit is given by reducing the salary in money

In this example, the employee's original pay is 2000 euros. The bicycle benefit is 100 euros. The bicycle benefit is given by reducing the salary in money. From the perspective of pension, unemployment, and accident insurance providers, a tax-free benefit given by reducing the salary in money is compensation for work, therefore the amount of pay that forms the basis for these insurance payments differs from the amount of taxable pay. For this reason, the basis for calculating insurance payments is greater by the amount of the bicycle benefit than the basis for calculating withholding tax and health insurance payment. 

You need a salary type for the tax-free bicycle benefit.

Link this salary type to the formula for Gross pay first as a plus and then as a minus:

Now you can give the amount of the bicycle benefit per employee in the section Pay > Personnel > Salary basis management :

Now when forming the payslip, the employee's tax-free bicycle benefit appears on the payslip:

In this option, the basis for calculating pension and unemployment insurance is the pay and bicycle benefit together, but the basis for calculating withholding tax is only the pay. The salary in money remains the amount of pay reduced by the bicycle benefit, and the basis for calculating the health insurance payment is also 1900 euros.

Example 4. The benefit is given by reducing the salary in money and the deduction is wanted to be visible on the calculation

If the bicycle benefit is tax-free and it is given by reducing the salary in money, the benefit can be handled in Netvisor according to the following examples. In this case, the deduction row is shown separately on the calculation.

Check that the salary type “Bicycle benefit, tax-free” has insurance handling selected and that the source of the salary type is the employee's salary basis. Check that the posting of the salary type corresponds to the company's posting practice. (Pay > Salary model management > Company-specific salary types > Bicycle benefit tax-free)

Check that the salary type “Bicycle benefit, tax-free” is linked to the desired salary model in gross pay as a plus and minus. In this case, insurance payments are collected from the benefit, but no withholding tax or sava payment.

(Pay > Salary model management > desired salary model > Salary type formulas > Gross pay)

Create a new salary type “Deduction of bicycle benefit from salary in money”. The salary type needs an income type and posting.

(Pay > Salary model management > desired salary model > Salary type formulas > Add new salary type and link to salary model)

The salary type is included in the formula for salary in money for the desired salary model (Pay > Salary model management > desired salary model > Salary type formulas > Salary in money). From the green plus, you can add two formula elements, Calculation “+” and Salary type “Deduction of bicycle benefit from salary in money”.

Add a formula to the salary type “Deduction of bicycle benefit from salary in money” (Pay > Salary model management > desired salary model > Salary type formulas > Deduction of bicycle benefit from salary in money).

From the Formatting tab of the salary model, you can move the deduction to the desired position on the payslip.

Add the amount of the tax-free bicycle benefit to the employee's salary basis if the amount is the same monthly (Pay > Salary basis management).

This way, the amount corresponding to the tax-free bicycle benefit is directly deducted from the salary in money, and the deducted amount appears on the calculation as its own row.

Example 5. Bicycle benefit which is given by reducing the salary in money, it is at most the tax-free value defined by the tax authority and compensation is collected from it

In this example, the employee's original pay is 2000 euros. The bicycle benefit is 100 euros. Compensation of 40 euros is collected from the net wage or salary. The bicycle benefit is given by reducing the salary in money. The compensation collected from the bicycle benefit is primarily deducted from the taxable portion of the bicycle benefit, but if there is no taxable portion, the compensation is deducted from the tax-free portion of the bicycle benefit. If there is no taxable portion, the collected compensation reduces the basis for calculating pension, unemployment, and accident insurance.

You need a salary type for the tax-free bicycle benefit from which compensation is collected:


You also need a salary type for the compensation collected from the bicycle benefit:

Link this salary type to the formula for "To be paid" salary type as a minus:

The difference between the bicycle benefit and the compensation collected from it is reported to the Income Register. For this purpose, you need your own salary type, which is given an income type allocation:

You can choose to hide this salary type from the payslip in the formatting of the salary model, so it does not appear to the employee.

Link this salary type to the formula for Gross pay salary type first as a plus and then as a minus:

In addition to linking to Gross pay, the salary type "Amount of tax-free bicycle benefit to be reported to the Income Register" must have a formula where the compensation collected from the employee is deducted from the amount of tax-free bicycle benefit:

Now give the employee's salary basis information in the section Pay > Personnel > Salary basis management > per employee the information of the bicycle benefit both in terms of its amount and the compensation collected from it:

Now when forming the payslip, the tax-free bicycle benefit and the compensation collected from it appear on the calculation, and the information of the difference between these is sent to the Income Register with income type 363.

In this option the basis for calculating pension and unemployment insurance is the pay and the difference between the bicycle benefit and the compensation collected from it together, but the basis for calculating withholding tax is only the pay. The salary in money remains the amount of pay reduced by the bicycle benefit, and the basis for calculating the health insurance payment is also 1900 euros. 

This article has been translated using an AI-based translation tool. The contents or wording of these instructions may differ from those in other instructions or in the software.


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