The roll-over of amounts is an option in the Meals and Transport Benefits setting that allows money to be rolled over so it can be used in the following months. This option allows the unused portion to be rolled over up to each employee’s exempt amount.
The advantage of the roll-over option is to maximise the employee's savings, when they know that they will use it later, but not necessarily at that moment, and therefore not miss out on the opportunity of making savings. If the employee does not use or roll over this amount, on reaching the last month of the year, they will no longer have the possibility of using the maximum annual exempt amount due to the monthly limit.
Savings on some benefits, such as Meals and Transport, are directly related to personal income tax brackets. For example, a person with a salary of between 20,200€ and 35,200€ has a 30% marginal income tax rate. If an employee is allowed by law to spend 220€ for each of 11 months (i.e., 2,420€), this means that they could save up to 726€ at the end of the year, which they would be obtaining month by month with the roll-over option.
Allowing the roll-over option means employees can make the most of this scheme.
Allow to accumulate the exempt limit
This option allows your staff to decide if they want to accumulate the remaining amount to reach the maximum exempt limit (€136.36 for transport) that they have already consumed in the current month. The balance accumulation can be from their payroll, social benefit, or both.
🎓 Example
If this month a person consumes 76,36 €, by activating this option, he/she could
accumulate 60 for the following month. This would mean that the following month
he/she could have up to 196,36 € exempted in Transport.
ç
Once activated, your employees will have an option within the app to decide whether or not to roll over the amount not used up to the exempt limit for the following months. This option will be deactivated by default.
The following conditions apply:
- Only for Meals and Transport
- Maximum amount: up to the maximum exempt limit according to the benefit and consumption limits depending on the salary. (220€ for Meals and 136.36€ for Transport).
- The employee's payroll reports what they roll over in the month in which the action is undertaken as if they had used it.
- The amount rolled over does not expire and can be used at any time.
- It can be activated for one cycle and deactivated for another during any day of the payroll cycle. However, if any amount has already been rolled over during a cycle, deactivating this option will not allow the rolled-over amount to be refunded.
🎓Example
Each employee has 11€ per day to spend on Meals with tax savings, with a maximum
monthly limit of 220€ exempt from personal income tax (11€ x 20 working days).
Let's imagine an employee with a consumption for Meals of 80€ at the end of the
current month and with the roll-over option activated. The amount rolled over
would be 140€, which would be added to the amount available in Meals for the
following month (220€ + 140€). Therefore 220€ would be reported as Meals in the
payroll report of the closing month.
If you roll it over you can spend it another month and indulge yourself for the company dinner 🍷
How the roll-over works according to type of delivery
The amount to be rolled over can only come out of salary sacrifice, only from the wallet, or both.
Roll-over of amounts from Salary Sacrifice
When does this apply?
- When the company does not provide Company Allowances either in Meals or Transport, i.e., it does not provide either a wallet or funds to your card.
- And the option to limit the use to funds from their company allowance has not been checked for this benefit.
At each payroll cut-off date, if the employee has checked the roll-over option in their app, the amount that the employee has not used from the exempt limits will be paid on the Cobee card to be used in the following periods. In other words, the payroll report will show the sum of what the employee has used and the remaining amount that is rolled over.
⚠️ Important!
It is important to take into account that if there are rollovers every month,
the employee will no longer be able to use the benefit in the twelfth month
(December), because they will have already used the maximum total amount allowed
for both Meals and Transport, 2,420€ and 1,500€, respectively.
Now some practical examples:
Example 1:
A company that provides the Meals benefit as a Salary Sacrifice. Let's imagine an employee with the roll-over option activated who has used 80€ in Meals at the time of closing the payroll cycle. The amount rolled over would be 140€, which will be added to the amount available in Meals for the following month (220€ + 140€). 220€ would be reported in the payroll report for that cycle.
Roll-over of amounts from the company allowance
When does this apply?
- When the company provides company allowances covering 100% of the exempt limit.
- And the option to limit the use to funds from their company allowance has been checked for this benefit.
At each payroll cut-off date, if the employee has checked the roll-over option in their app, the amount that the employee has not used from the exempt limits will be paid on the Cobee card to be used in the following periods. As long as the option is checked, the payroll report will show the entire income tax exemption limit, which consists of the sum of what the employee has used and the remaining amount that is rolled over.
Example 1:
A company is offering a 220€ wallet for the Meals Benefit. During this payroll cycle, an employee has used 140€ in Meals with the roll-over option activated. The payroll will report the 140€ used from the wallet and the remaining amount (80€) rolled over on the card. 220€ would be reported in the payroll report for that cycle.
Roll-over of amounts from the company allowance
When does this apply?
- When the company provides company allowances covering 100% of the exempt limit.
- And the option to limit the use to funds from their company allowance has been checked for this benefit.
At each payroll cut-off date, if the employee has checked the roll-over option in their app, the amount that the employee has not used from the exempt limits will be paid on the Cobee card to be used in the following periods. As long as the option is checked, the payroll report will show the entire income tax exemption limit, which consists of the sum of what the employee has used and the remaining amount that is rolled over.
Example 1:
A company is offering a 220€ wallet for the Meals Benefit. During this payroll cycle, an employee has used 140€ in Meals with the roll-over option activated. The payroll will report the 140€ used from the wallet and the remaining amount (80€) rolled over on the card. 220€ would be reported in the payroll report for that cycle.
Mixed Delivery (Wallet and salary sacrifice)
When does this apply?
- The company provides company allowances that does not cover 100% of the exempt limit and the employee has used up the entire company allowance.
- The employee is not limited just to the use of the company allowance
If you provide a wallet that does not cover 100% of the exempt limits and, in addition, the benefit is not limited to the company allowance (salary sacrifice can be used), then the amounts will be rolled over up to 220€ for Meals and 136.36€ for Transport using both company allowances and salary sacrifice.
Example 1:
Imagine that you give a wallet of 150€ just for Meals. There is still 70€ left to reach 220€ that could be used using Salary Sacrifice. In the current month, an employee has spent 120€ of the funds in the wallet in Meals, and at the payroll cut-off date, the remaining 30€ of the wallet and 70€ of their salary will be rolled over on the card.
Another example could be to give a wallet of 100€ just for Meals. There is still 120 left to reach 220€ that could be used using Salary Sacrifice. In the current month, an employee has spent 100€ of the funds in the wallet in Meals, and 40€ of Salary Sacrifice. At the payroll cut-off date, 80€ of their salary will be rolled over on the card.
In the event that the wallet affects both Meals and Transport, amounts will be rolled over in order of priority. First, any amount will be rolled over for Meals up to the maximum exemption limit. And if there are still funds left in the wallet, they will be rolled over for Transport.
Example 2:
Imagine that you provide a wallet of 200€ for Meals and Transport. And an employee who has the rolled-over option activated for both Meals and Transport spends 75€ on Meals and 25€ on Transport in a month. At the end of the payroll cycle,145€ would be rolled over on the card for Meals, of which 100€ would come from the remaining amount in the wallet and 45€ from their salary. For Transport, 111.36€ from their salary will be rolled over.
Force delivery for all employees (up to exempt limits)
There is an option with which you can force delivery up to unused exempt limits at the end of the cycle. All you have to do is check the "payment on the card” box when you create a wallet.
The following restrictions apply:
- Only valid when the wallet has Meals and/or Transport.
- Maximum amount: up to the exempt limit according to the benefit.
- This is reported in the employee's payroll as if it had been used in the month in which it is rolled over.
- The amount rolled over does not expire.
The remaining money will be paid into the employee's Cobee card to be spent on these benefits and applies in the same way for both, i.e., at the time the payroll is closed, the system will try to deliver the funds up to the exempt limit for Meals and then it will try to do it for Transport, if there is a balance available.