An incentive trip is a wonderful way to reward and motivate your team. But how do you ensure that such a trip is not only inspiring but also financially attractive? This is where the Work-Related Expenses Scheme (WKR) comes into play. By making smart use of this scheme, you as an employer can reimburse certain costs tax-free.
In this blog, we explain how to make the most of the WKR for your incentive trip.
What is the Work-Related Expenses Scheme (WKR)?
The WKR scheme is part of Dutch tax legislation and is a regulation that allows employers to provide tax-free allowances to their employees, as long as these fall within the discretionary scope. The discretionary scope is a percentage of the company’s total fiscal wage bill. This scope is redetermined every year. In 2025, this amounts to 2.00% on the first €400,000 of the wage bill and 1.18% on the amount above that.
Sylvia, Business Unit Manager MICE: “Many companies don’t know that they can (partially) reimburse an incentive trip tax-free via the WKR. This makes it financially more attractive to reward employees with a special experience.”
When does an incentive trip fall within the WKR?
An incentive trip can fall under the Work-Related Expenses Scheme (WKR), but several factors are important here:
Reward character and discretionary scope:
- An incentive trip is seen as wages if it has the character of a reward. This means the trip is considered a form of compensation for the employee’s work.
- The trip can only be reimbursed tax-free if there is sufficient discretionary scope available within the WKR. If the discretionary scope is exceeded, the employer must pay an 80% final levy on the excess.
Business costs and targeted exemptions:
- If the trip has a purely business purpose, such as mandatory training or a conference that is functional for the performance of the work, the costs can be classified as business expenses and fall outside the WKR.
- This only applies if the content of the program and the setup of the trip clearly demonstrate that there is a functional purpose.
Voluntary participation:
- Voluntary participation is not a strict requirement for the WKR. Mandatory trips can also fall under the discretionary scope, as long as they are classified as wages. However, if the trip includes mandatory business training, the costs may fall outside the WKR as business expenses.
Exchange of vacation days:
- It is possible to exchange vacation days for an allowance, but this must be correctly substantiated from a fiscal and legal perspective. The Tax Authorities may still classify this as wages if the allowance is seen as a form of reward.
"The WKR is complex and its application can vary per situation. It is therefore advisable to contact a tax advisor in case of doubt for specific questions regarding the application of the WKR to incentive trips."
How do you make the most of the WKR for an incentive trip?
1. Calculate your discretionary scope
Before planning an incentive trip, it is smart to gain insight into your available discretionary scope. This prevents unexpected fiscal costs.
2. Split business and non-business costs
Divide the trip into business and non-business components. For example:
- Business: training, workshops, business meetings (these may potentially fall outside the WKR)
- Non-business: excursions, dinners, festive activities (these fall under the discretionary scope)
3. Use targeted exemptions
Certain costs fall outside the WKR due to targeted exemptions, such as travel allowance and accommodation costs for business overnight stays. This helps to leave more room for the reward component of the trip.
What if you exceed the discretionary scope?
If you exceed the discretionary scope, you must pay an 80% final levy on the extra amount. This can significantly increase costs. Therefore, it is important to make a proper calculation beforehand and possibly consider alternatives, such as a mix of WKR and private contributions from employees.
Conclusion
An incentive trip does not just have to be a great reward; it can also be arranged in a tax-efficient way using the WKR. By making smart use of the discretionary scope and clearly distinguishing business costs, you get the most out of your budget.
Do you want to organize an incentive trip and make optimal use of the WKR? Contact our project managers. We are happy to help you with a tailor-made plan!
Want to know what is possible for your organization?
We are happy to think along with you. Contact us without obligation or discover how an incentive trip can strengthen your company.
